Westpac, St George penalty fee cuts not enough
CHOICE says banks need to justify $9 fee to their customers.
CHOICE says the announcement by Westpac and St George of a $9 across-the-board penalty fee for transaction and credit card accounts is welcome but doesn’t go far enough.
CHOICE says if there is a loss incurred by the bank when customers overdraw accounts or incur dishonoured direct debit transactions, then the bank needs to come clean about exactly how much it costs to process that transaction.
“The move by Westpac and St George to cut their penalty fees from up to $45 to $9 is a step in the right direction but the fact remains that all the banks remain secretive about the cost incurred by them when a customer overdraws their account,” said CHOICE spokesman Christopher Zinn.
“As far as CHOICE is concerned until the banks are transparent on this issue we will continue to campaign for all banks to drop unfair penalty fees across all accounts.”
The NAB announced last week it would be dropping all penalty fees for transaction and savings accounts but their credit card penalty fee remains at $30 for a late payment and $25 for going over the limit.
“At present, these fees cannot be justified. Penalty fees should only allow banks to recoup any losses incurred by the bank but we know that in the case of credit cards, there aren’t any, because the banks continue to accrue interest on any outstanding debt,” says Zinn
CHOICE says the move by Westpac and St George today puts further pressure on the CBA and ANZ, both of whom are yet to announce their position on penalty fees except to say that they are “under review”.
“We know that penalty fees are at the top of the list of customers’ complaints about banks. The CBA and ANZ need to demonstrate a genuine commitment to their customers by dropping these punitive penalty fees.”