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Banking industry in Australia - statistics & facts

The banking industry in Australia has developed greatly over time, with a history closely tied to major past events. In 1817, the first bank in the country was established as the Bank of New South Wales. From then on, many additional local and a few foreign banks were set up, with mergers and acquisitions continually changing the sector's landscape. While there are just a few major domestic banks in the country, there are now almost one hundred different banks operating in Australia, including foreign banks.

Australia's rich banking history

After the Great Depression, more banking regulations were adopted, making it difficult for foreign banks to operate in the country. Fewer banks were involved in the sector, and these were classified as either state-owned savings or commercial trading banks. This left a gap in the market for building societies and credit unions to fill and thrive. From the mid-1960s onwards, deregulation of the country’s financial sector meant that savings and trading banks no longer had to be distinct in their functions and separate from each other. Interest rates could be set by banks themselves and building societies could take deposits from the public. Bank acquisitions throughout the 70s and 80s led to a few larger banks dominating the market. Due to growing concern and political pressure regarding the shrinking number of large banks operating in the market, the Australian government adopted the ‘’four pillars policy’’ in 1990. The policy was implemented to stop further mergers between the Big Four banks in the country. Today, the Big Four banks are ANZ Bank, Commonwealth Bank, National Australia Bank, and Westpac. With many smaller banks also providing financial services, most banking consumers are satisfied with their bank in the country.

Banking on technology

The future of banking in Australia will change drastically over the coming decade. Banking services are already accessible online, with the number of active online banking users around the world set to continue to soar in the coming years. Among other things, mobile banking apps offer users the ability to instantly transfer money, set up and manage personal budgets and savings goals, and automate bill payments with the touch of a button, and often on a 24/7 basis. The evolving financial technology (fintech) sector will likely continue to lead changes in the industry, while demographic, socio-economic, and regulation factors will also play a large role in shaping the banking industry across the country. The internet of things, cloud computing, artificial intelligence, and 5G are just a few of the technological capabilities predicted to impact the banking sector in the coming years.

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