CHOICE says consumers should play banks at their own game and demand discount
CHOICE says if the big four banks fail to pass on any cuts to the cash rate in full, it will underline a lack of genuine concern for their home loan customers and raise doubts about competition in the sector.
The people’s watchdog says the banks’ recent comments aimed at ‘softening up’ the market ahead of Tuesday suggests they are counting on each other to act in lockstep in failing to pass on any reductions in full.
CHOICE also says the big four are banking on customers staying put and not switching to potentially cheaper smaller lenders.
“Despite their record profits the banks continue to claim that somehow their funding costs give them no possible option but to hold back passing on any cuts in full,” says Christopher Zinn, CHOICE director of campaigns and communications.
“But there is now evidence that banks are less reliant on overseas funding, and in fact their approach is about making record profits the new normal, while putting their customers last.”1
If their bank fails to fully pass on any cut, CHOICE advises borrowers to consider switching to lenders which have lower rates and better offers. Use the compare, ditch and switch tool to compare deals at http://betterbanking.choice.com.au/ditch-and-switch
The Australian Bankers Association last year said “invariably borrowers are routinely offered discounts, which can shave up to one per cent off the interest rate.” 2
“Almost no one under this generous offer should be paying the standard variable rate. If you don’t have your discount then beat the banks at their own game and demand one now. If they refuse, then politely threaten to switch as that’s one language they understand,” says Mr Zinn.
Christopher Zinn, CHOICE Director of Campaigns and Communications: 0425 296 442
1. See ‘Bank Funding’ chart at http://www.rba.gov.au/chart-pack/banking-indicators.html