Major-brand supermarkets and fuel retailers in bankless towns could be eligible for exemptions from the Federal Government’s proposed cash mandate regulations under exceptional circumstances provisions, an official from Treasury confirmed today during Senate Estimates hearings.

The information was obtained by West Australian Senator Tyron Whitten in a series of questions about regional banking services.

“If a location where are supermarket or fuel outlet is located doesn’t have a bank branch or reliable financial institution to obtain cash floats or deposit business takings, will this be considered an exceptional circumstance,” Senator Whitten asked.

“It could be,” First assistant secretary of the Financial System Division Lynn Kelly replied.

Ms Kelly said the draft regulations contained no definition of exceptional circumstances and each application would be looked at on a case-by-case basis by the Australian Competition and Consumer Commission.

After acknowledging that poor access to cash services could be grounds for an exceptional circumstances exemption, Ms Kelly was quick to add that the Government was looking at a workaround.

“There is another piece of work that the Council of Financial Regulators has been undertaking around a cash regulatory framework and a big underlying driver for that piece of work is to ensure affordable access to cash around Australia,” she said.

“The two need to fit together.”

Senator Whitten continued.

“An example was in Queenstown in Tasmania where a local petrol station began refusing to take cash payments about two years ago and the town recently lost its last bank. The post office has been unable to keep up with demand for cash, frequently having to put out calls on social media begging for change – the town running out of cash made national news,” he said.

“Would a major brand of supermarket or service station in a town experiencing issues such as this be granted an exception from the legislation under exceptional circumstances?”

Ms Kelly returned to a solution outside the cash mandate proposal.

“Again, that would be something for the regulator to consider however, the cash regulatory framework that the Council of Financial Regulators has been working on has been looking at how to ensure there is affordable access to cash and some of the features that have been consulted on are service-level standards for regional Australia,” she said.

No further information on the cash regulatory framework was provided or a timeline for its introduction given.  

Senator Whitten’s questioning also revealed that while the final report into the senate inquiry into regional bank closures remains ignored with no official government response after more than 18 months of it being tabled, the Government has been working directly with the major banks to come up with its own initiatives in place of the eight recommendations made by the senate committee.

“If there is no mandate for banks to provide cash services out in the regions, how could the cash mandate be effective for regional communities,” he asked.

“We have been working very actively with the banks in relation to regional banking services and how to shore them up,” Ms Kelly said.

“We’ve also been actively working with banks on how they will lean back into regional banking services.”

Ms Kelly said Treasury was involved with the recent Westpac announcement to work with councils to put some banking services back into regional communities, a scheme that has been criticised by Regional Banking Alliance spokesman David Heine for separating “the profitable part of banking from the social contract of providing real branch services”.

Ms Kelly took on notice a request to provide the summary of advice Treasury provided to the Government on the recommendations from the senate inquiry into regional bank closures.

This article appeared on The Regional on 3 December 2025.
Related story: Fatal flaws: what regional Australians need to know about cash plan

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