The remote town of Coober Pedy, which relies on large amounts of cash for its opal mining and tourism industry, is set to lose its only bank next year.

And the next one is more than 500 kilometres away.

Last week, Liberal National Party of Queensland Senator Gerard Rennick hit back at Westpac for its decision to close its last bank in the outback South Australian town in February and called for government-owned postal banks to serve regional towns.

The Australian Citizens Party (ACP) is behind the campaign to get a bill to pass through the federal parliament to establish public post office banks around regional and remote parts of the country by utilising the Australia Post network.

Data collated by the ACP revealed the South Australian electorate of Grey, which encompasses the small opal mining town, had suffered the most bank losses out of any electorate in the country, having lost more than 80 per cent since 1975.

Business and tourism impacted

Coober Pedy District Council chief executive David Kelly said while Australia Post was preparing to provide banking services to the community in place of Westpac, the services would be limited. 

"You can only withdraw $2,000 at a time or deposit up to $7,000 at a time, which just doesn't cater for the market up here.

Mr Kelly said while he expected a big portion of local residents to sign ACP's petition for a public bank network as a long-term solution, other avenues would be explored in the meantime to support the community.

He said council would write to Westpac to ask for a six-month extension of the February closure date, as well as conduct a pledge, which could see a number of customers leaving the financial provider.

"A lot of people are going to pledge that if another bank or financial institution will come to town and will provide a better service than Westpac is able to, then they'll move all of their business over to that particular organisation."

Westpac walks away

Long-time Coober Pedy opal miner Dale Price said surrounding areas like Oodnadatta and William Creek would be impacted by the closure with the closest bank now 540 kilometres away in Port Augusta.

Mr Price said while his opal business was likely not to be impacted by the closure, the international wholesale trade of the gemstones would be at a loss.

"It will impact a lot of the buyers that actually travel to Coober Pedy to buy opal as they won't have access to money, which means they'll have to bring hundreds of thousands of dollars when they travel, and that is a security issue," he said.

"The Indian market, for instance, is huge in the opal industry, and it's growing by a million stones a year.

"It mainly uses Coober Pedy material, and I've been encouraging these buyers to come and deal directly with the buyers since 2007, and since that time, we've seen at least a doubling of our price of opal.

Like many other residents who have been the bank's customers since its introduction to the town, Mr Price said he would support a pledge to move his business elsewhere to a different institution.

Town left 'high and dry'

Coober Pedy Retail, Business and Tourism Association chair Jason Wright said while businesses would be hurt, there was more concern for the most vulnerable people in the community, such as the elderly and Aboriginal community, who were not familiar with online banking technology.

"They're going to be people who are going to be very affected," he said.

"And this is actually going to have an ongoing mental health problem caused by this bank's closure."

Mr Wright said there was also concern about residents having no cash or access to online banking during power outages, which were reasonably common in the remote town. 

"I know a couple of years ago we had three days without power after a huge lightning storm — that'd be three days where no one can buy anything," he said.

"In my personal opinion, I think it's quite disgraceful.

Decision 'kick in the guts'

The federal Member for Grey, Rowan Ramsey, said he understood there was a lot of anxiety within the community since Westpac made its announcement. 

"It's a fair kick in the guts, I'd have to say, for a town like Coober Pedy," he said.

Mr Ramsey said while he had no luck convincing Westpac to stay, he had been in discussions with other banks about the possibility of taking over.

"I don't know that any of those are going to deliver for Coober Pedy by February, but I'm doing everything I possibly can to explore every option."

Mr Ramsey said he was yet to make a decision on whether he would support a government-owned post office bank network. 

"The proposal to make Australia Post a full banking competitor, if you like, with the Big Four, I'm happy to talk about, but I think it's a long way down the path," he said.

In a statement, Westpac said it made the decision to close the facility due to declining customer use of the branch.

It said it would be offering a dedicated team to help Coober Pedy customers with the transition of its closure, including working with the team at Australia Post to help familiarise customers with the new services.