CHOICE, assisted by real ‘watchdogs’, will be delivering letters outlining the Better Banking campaign to bank CEOs
Survey reveals crisis of consumer confidence in banks
CHOICE, the people's watchdog, today launches its Better Banking campaign aimed at putting consumers first in line for better competition alongside practical measures for better services, fairer products and decent practices.
The launch of the Better Banking campaign coincides with fresh research showing that – despite widespread dissatisfaction – almost 80% of bank customers have not considered switching to other financial institutions because of the effort involved and the fear that it will make little difference.
The Better Banking campaign will focus on some immediate practical solutions to help the banks and government demonstrate much needed decisive, confidence- building leadership. CHOICE will also ensure that the voice of consumers is heard loud and clear in national and international debates about banking.
Better Banking campaign director Richard Lloyd says real reform must begin now as the problems of rip-off fees, consumer unfriendly policies and excessive market power are well known.
"From our research it seems the crisis in banking has moved from the global to the local level with consumers lacking confidence in the ability and willingness of banks to compete. The Better Banking campaign will take the people’s frustrations to the heart of government and the banking industry.
“Our Newspoll results* show that, despite the government's bank switching push, only 7.6% of Australians have switched bank accounts in the last two years. Despite the controversies a staggering 78.5% have not even given switching a thought,” saysLloyd.
“As a first step, banks and the government must take speedy action to reduce the hurdles and make this a simpler, streamlined and a more worthwhile option.”
The CHOICE Better Banking campaign will include a series of country-wide, town hall style meetings where consumers can discuss their concerns and have their say on priorities for a better banking system.
"Throughout the GFC the voice of banks was heard loud and clear, now it’s the people’s turn. CHOICE will combine their sense of urgency with practical solutions to make a difference now rather than never. No option should be off the table." says Lloyd.
The CHOICE campaign for a better, more competitive banking sector is calling on the banks, the government and consumers to each act:
BANKS – GET ON BOARD AND MAKE SWITCHING EASIER
- Get on board now with Better Banking before the Government is pushed by overwhelming public opinion to force change through regulatory measures.
- Eliminate unfair charges.
- Make it easy to switch.
GOVERNMENT – STAMP OUT UNFAIR FEES AND INCREASE COMPETITION
- Stamp out disproportionate banking charges across the board.
- Put in place a mandatory new switching scheme that takes the hassle out of switching - consumers wanting to move to a new bank should only have to sign a single form at the new bank that guarantees the transfer of all direct debits and credits from the old bank to the new.
- Break down barriers to new providers offering alternative banking services.
CONSUMERS - CALL YOUR BANK TODAY AND DEMAND A BETTER DEAL
- Ask your bank for a better deal; go to www.choice.com.au/betterbanking for advice.
- Consider switching financial institutions – see if you can get a better deal with a smaller bank, credit union or building society, customers of these institutions are normally much more satisfied than Big Four customers.
- Sign up to Choice's Better Banking Campaign and attend CHOICE's Better Banking forums in your town or city; www.choice.com.au/betterbanking
SUMMARY OF CHOICE COMISSIONED NEWSPOLL RESULTS (1,203 people surveyed nationally; 29-31 October 2010, by telephone):
- 78.5% have not even thought about switching;
- 11.8% have thought about switching and not done so;
- 7.6% of people surveyed have switched bank accounts;
- The most common major reason people choose not to switch is because it takes too much effort to sort out all the paperwork (50.4%);
- Not having enough time to research the best deal (48.4%) and not believing they will be better off anyway (44.1%) were also major reasons for not switching.
- Older people – 50 years+ - are least likely to switch (3.4%).