Coleambally is set to have a full-service post office again by late October, bringing an end to months of community anger over the loss of banking, bill payments and other essential services.

Australia Post confirmed last week that Marilyn’s Pharmacy will expand its existing postal operation and take over as a licensed post office (LPO) following a successful expression of interest process.

“In exciting news, a licensed post office (LPO) will be re-established in Coleambally after an extensive review of postal services in the community,” an Australia Post spokesperson said.

“Following a successful expression of interest (EOI) process, Marilyn’s Pharmacy will be expanding their services and operating as an LPO from late October.

“The pharmacy has already demonstrated its commitment to the community, having operated a community postal agency after it stepped in at short notice when the previous LPO closed unexpectedly.”

The announcement marks a significant turnaround after a bitter dispute between residents, Australia Post and politicians over the future of postal services in the town.

Coleambally has had a postal service since 1970, while the most recent LPO had been operated by Ledwidge Pty Ltd from 33-35 Brolga Place since 2014.

Residents were shocked in January when they were told it would cease operating on 6 February.

The reasons for the sudden closure were not publicly explained, while concerns quickly emerged that the town would be left with a much more limited community postal agency rather than a full LPO.

Those fears were realised when Marilyn’s Pharmacy, next door to the former post office, stepped in from 9 February to provide basic postal services.

The pharmacy offered mail sending and receiving, postage assessments, stamps and prepaid satchels, but did not provide the broader services available through an LPO, including banking, BPAY bill payments, parcel tracking and dedicated PO boxes.

For many residents, particularly older people, the change meant travelling to Darlington Point – about 29 km away – to access some of those services.

Murrumbidgee Council mayor Ruth McRae said the lack of public transport and the town’s ageing population made the arrangement particularly difficult.