The banks are accused of not answering phones, under-staffing branches so there are long queues, and failing to quickly repair broken ATMs as a way of pushing people to do their banking online.
The Financial Services Union (FSU) claimed banks were engaged in a deliberate policy of moving people away from cash payments and bricks-and-mortar banking.
In a submission to the Government’s retail banking review, the FSU said banks are failing personal customers, small firms and their staff.
The FSU said the sale of hundreds of ATMs to private operators and the removal of ATMs from a large number of branches shows that banks have little interest in servicing their customers.
The FSU submission referenced a survey commissioned by the Department of Finance showing 58pc of people think banking services have got worse since the crash.
FSU general secretary John O’Connell said: “The banks have used Covid and the transition from it to force people on to digital platforms, whether they want to or not.
“The lack of staffing banks is chronic in banks for a reason. It creates long queues. It is the same with the phone lines.”
He said ATMs were out of service a lot and claimed that inadequate service contracts have been agreed, which means it can take a while for ATM services to be restored.
“Covid has been the Trojan horse used to force people on to digital platforms.”
He claimed the banks said they were temporarily reducing hours of service during the pandemic but have failed to restore these to pre-Covid levels.
“This is all to deny people cash and drive them online.”
Both Bank of Ireland and AIB have closed 100 branches between them over the last 18 months, the submission said.
The submission was written before AIB proposed plans to withdraw cash services and take ATMs out of 70 of its branches.
The chief executive of AIB later admitted the bank “got it wrong” amid a public outcry and political cricitism. The bank reversed the decision to downgrade the branches.
“We got it wrong,” Colin Hunt told Business News on RTÉ’s Morning Ireland. “The lesson for us from this is that we moved far too far, far too fast.”
Mr O’Connell said a European Central Bank strategy paper on cash has stressed that the acceptance of cash is essential for the freedom of choice on how people pay for products and services.
“A head-long rush to eliminate cash from society without proper consideration, which is what appears to be occurring, is not a responsible or thought-out strategy,” the submission says.
The FSU wants the Government to put legislation in place to allow for the regulation of the prices and service standards for ATMS that are privately operated.
The pay cap on AIB, Bank of Ireland and Permanent TSB, which was put in place when they were bailed out, is not just impacting senior executives but also ordinary staff, the FSU submission said.
Part of the pay cap prohibits variable pay. This means banks are not allowed to fund benefits such as contributions towards health insurance premiums and help with childcare costs.
This issue impacts 23,000 workers, the FSU said. It even affects junior staff, including those on starting salaries of €20,000.
The Department of Finance’s retail banking review is due to issue its recommendations in October.