01.Freedom from fees
Australian households paid $1.9 billion for transaction accounts in 2008, and banks’ fee income has been growing at 8% annually. We’ve been the victims of unfair and excessive charging and penalties are a big part of the problem; bank dishonour, default and overdrawn transaction account fees amounted to $490 million in 2008. CHOICE led the charge against those penalties, and under pressure from consumers, the Big Four banks responded with fee reductions. NAB went furthest, recently removing account penalties altogether.
We compared standalone transaction accounts available from all banks and the 10 largest building societies and credit unions. For the first time, Australian consumers can choose an account with no monthly fee, no fees for certain ‘everyday’ transactions and no penalty fees. These accounts aren’t bundled with other products; home loan customers, for example, may wish to consider the pros and cons of a mortgage offset account.
For people with high cost accounts, the potential savings from switching account or changing behaviour may amount to $200 or more per year. Average fees paid with uncompetitive transaction accounts (Fujitsu Consulting) include:
- $5 monthly account keeping fees ($60 per year)
- overlimit penalties ($95) and transaction fees ($34)
- annual cost of using ATMs belonging to another bank or company's network is estimated at $36 on average
Government data is not yet available, but the collective annual savings from switching accounts could amount to hundreds of millions of dollars for banking customers.
30 Sep 2009
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Over the past year, ANZ, Commonwealth, NAB and Westpac have increased market share but our survey reveals they haven't increased in popularity.
18 Jan 2010
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The new Bankwest Zero account refunds its customers the fees that the big four banks charge when you use their ATM machines.
27 Jul 2010
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If you're not happy about their profit, and your fees, ask for a better deal. CHOICE shows you how to find the fairest bank account and then switch to save.
15 Feb 2008
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For most of us, minimising the cost of 'staple' financial services like bank accounts and insurance is important. Here's how to save.
10 Mar 2010
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The account isn't completely fee-free and it doesn't pay interest, but most everyday transactions are free and there are incentives that will be attractive to many customers.
23 Mar 2009
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Despite the market hitting a five-year low, the worst may not be over, with further ups and downs likely in this volatile economic environment.