New Zealand’s biggest banks have pulled dozens of cash machines out of service in the past two years, and the Reserve Bank is now weeks away from deciding whether to put a floor under how far people should have to travel to get their own money out in notes.
ANZ, the country’s largest bank, told RNZ it had reduced its ATM numbers by 85 over the past two years. In all but 10 of those cases the contract for the site was handed to another provider, so a machine of some sort remains. Westpac said its own count had fallen by 54 over the same period.
Those are the recent numbers. The longer trend is steeper. The Reserve Bank says the number of bank branches around the country is down 40 percent over the past decade, and the number of bank-owned ATMs has dropped 32 percent. Between 2012 and 2017 alone, total ATM numbers fell 14.7 percent for every million people.
What frequently replaces a bank-owned machine is a privately owned one that charges to use it. A withdrawal from a non-bank ATM can cost $2.50. On a $40 withdrawal that is a fee of more than 6 percent, paid by the customer for the privilege of taking out cash that is already theirs. The people most likely to pay it are the people least able to drive somewhere else.
The banks say they are following their customers. New Zealand Banking Association chief executive Roger Beaumont said the shift reflects how people actually pay for things now.
“The main reason there are fewer ATMs is that fewer customers are using them. Around 1.5 percent of all customer transactions are made at an ATM, and that’s slowly reducing every year,” Beaumont said.
“In some cases, landlords making changes to tenancy agreements, or seismic risk, may lead to banks removing or relocating ATMs.”
Massey University banking expert Claire Matthews said the machines carry a real cost and a real risk, because they hold cash, and there has to be enough use to justify keeping them.
“People use less cash and are more likely to get cash with eftpos transactions if they do want it, so there is less use of cash. I’m struggling to remember when I used an ATM,” Matthews said.
University of Auckland senior lecturer in economics Chanelle Duley described the fall in machine numbers as part of a broader retreat from physical banking infrastructure, of which branch closures are the more visible half.
The counter-argument is that a transaction share of 1.5 percent does not tell you who is in that 1.5 percent. Consumer NZ said it was concerned, pointing to the Reserve Bank’s own cash-use survey from September 2025. That found 40.3 percent of people still used cash for everyday things, and only 2.5 percent said they never used it at all. A payment method that almost nobody has abandoned entirely is a different proposition from one that is dying.
Fincap, the network that supports financial mentors, said cash matters a great deal to many of the people its mentors work with, and that some households rely on it as a budgeting tool because money in an envelope cannot be spent twice. It said mentors in both rural and urban areas had reported people struggling to get hold of cash.
“In rural areas the cost of significant travel to access cash can compound financial hardship,” Fincap said. “In urban areas, we have heard concerns around hardship or exclusion for clients who have a disability and/or, limited time amongst their other obligations to queue or travel for the limited local available services which do not charge for cash withdrawal.”
That is the gap the Reserve Bank has spent the year trying to close. In February it opened a consultation called Keeping Cash Local, proposing a minimum standard for the cash services banks must provide. The proposal would require that at least 95 percent of people living in urban areas, meaning places where 1,000 or more people live close together, are within a walkable distance of a free service where they can withdraw cash, deposit cash and swap notes for smaller notes and coins. Walkable was defined as no more than a three kilometre one-way trip.
Rural sites serving between 200 and 1,000 people would need to be within a 15 kilometre drive, stretching to 30 kilometres for genuinely remote areas. The draft also set a density target of at least 2.5 multi-bank, full-service cash sites for every 10,000 people, or the equivalent made up of partial-service sites, and said customers should not face unreasonable waits.
Ian Woolford, the Reserve Bank’s director of money and cash, put the case for it plainly when the consultation opened on 25 February.
“We believe banks must provide cash services to customers, free-of-charge, because cash is an essential part of a customer’s relationship with their bank,” Woolford said. “The public expect banks to provide cash services to them, but banks have been steadily reducing points of access for their customers to get cash.”
The Reserve Bank costed the standard at about $104 million a year for the banks, and argued the benefits were worth $2.83 billion a year to the country. It has also noted that the annual bill would amount to roughly 1 percent of the combined profit the banks make.
The industry has not accepted that arithmetic. When the proposal was released, banks and their lobbyists pushed back hard on both the cost and the Reserve Bank’s authority to impose it, and the regulator was pressed to publish the legal basis for what it was proposing. It confirmed in April that it would prefer a voluntary industry agreement, but that a standard could be imposed by regulation under section 72 of the Deposit Takers Act 2023 if the Minister of Finance and Cabinet decided that was necessary.
Assistant Governor Karen Silk said at the time that the bank was publishing the extra material because “we received detailed questions about the proposal’s legal basis”.
The consultation was extended from its original April deadline and finally closed on 31 July. Close to 6,000 submissions came in, a very large response for a technical banking rule and a sign that the question of who can get cash, and where, is not a niche concern. A Reserve Bank spokesperson said it was still working through those submissions and could not comment further.
Findings are due late next month. Until then the machines keep coming out, one contract at a time, and the map of where a New Zealander can walk to get cash for free keeps getting a little thinner.
Have you lost an ATM from your town or suburb, and what did you do about it? Tell us in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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