Banks, retailers to financially support Armaguard for up to 12 months
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The news: Major banks ANZ, Commonwealth Bank, NAB and Westpac, as well as Australia Post, Coles, Wesfarmers and Woolworths will coordinate financial support for up to 12 months to cash-in-transit service Armaguard, following authorisation from the competition regulator.
The context: The interim authorisation will be in place while the Australian Competition and Consumer Commission (ACCC) considers a long-term authorisation from the Australian Banking Association, along with the major banks and retailers, which would last until 30 June 2026.
The authorisation allows the companies to discuss and plan measures under their respective service agreements and with Armaguard’s cash-in-transit business. The parties are also seeking to develop, but not implement, an independent pricing mechanism for their cash services agreements with Armaguard.
Linfox Armaguard and Prosegur Australia gained merger authorisation in June 2023 to combine their cash distribution and management and other businesses in Australia, but Armaguard flagged it was struggling to deliver services at the same prices as cash services decline.
The ACCC granted interim authorisation to banks and retailers late last year to ensure they could discuss plans to keep cash services in place. The industry group and companies were authorised to consider discussing their responses to cash distribution challenges in May, before they applied for a further authorisation in June, which included financial support elements and the development of a pricing mechanism.
What they said: “We consider that the financial assistance to Armaguard increases the likelihood of a more sustainable supply of wholesale cash distribution services as well as access to cash by businesses and members of the public across Australia," acting ACCC chair Mick Keogh said in a statement.
The source: ACCC media release
