The essence of the CHOICE Better Banking report is summed up in its recommendations. Each practical solution to longstanding problems is in part a response to what we’ve heard from consumers and other stakeholders. These recommendations are CHOICE’s detailed action plan, and we urge the government to consider them carefully as it pieces together its own reform agenda.
1. Introduction of portable account numbers
CHOICE recommends we learn from improvements in customer mobility in other sectors (including telecommunications and superannuation) and introduce portable bank account numbers in Australia.
2. A permanent consumer deposit guarantee
Deposit guarantee should remain in place permanently at a level that recognises the international best practices in this area.
3. Removal of barriers to switching home loan products
CHOICE strongly supports a ban on mortgage exit fees and a comprehensive review of Lenders Mortgage Insurance to ensure that it does not remain a barrier to switching home loans.
4. Removal of ATM fees for on-screen balance inquiries and improved disclosure on ATMs
CHOICE recommends the removal of ATM fees charged for on-screen balance inquiries. Regulators should require banks to meet a new, improved standard of external disclosure on ATMs, including the external disclosure of typical fees.
5. An obligation on banks to provide affordable access to payment systems
The banking sector should have an obligation to ensure that all communities have access to affordable payment services.
6. Improved disclosure for all credit products
Regulators should require banks to meet a new, improved standard of disclosure for credit products in plain language.
7. Improved disclosure for other banking products
Regulators should require banks to meet a new, improved standard of disclosure for a range of other banking products, including term deposits, savings products and Lenders Mortgage insurance.
8. Publication of complaints statistics that name institutions
The Financial Ombudsman Service and/or ASIC should publish a regular table showing complaints received by category, and identifying the institution responsible.
9. Introduction of a super-complaints mechanism
A super-complaints mechanism should be introduced to enable consumer organisations and dispute resolution providers to formally raise significant issues directly with the regulator.
10. Introduction of a systemic issues register
Regulators should be tasked with monitoring and identifying systemic issues in the banking sector in a more proactive way.
11. A specialist consumer representative organisation on financial services
A specialist consumer watchdog is needed to represent the consumer interest in financial services issues.
12. Bank executives’ remuneration linked to good customer service not sales targets
Regulators should ensure in their scrutiny of remuneration arrangements that senior executives and front-line bank staff are rewarded for good customer service, not just for driving bank profits.
13. Further reform of corporate governance rules for banks
Shareholders and boards have a duty to hold executives and board chairs to account for failures in customer service.
14. Banks to meet in full their obligations to the community
The Treasury should publish a review of the tax arrangements in place for banks, end any special treatment and instead consider new mechanisms to ensure the banking sector helps fund the cost of remedying market failures.