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Time to get Dollarmites out of schools

Consumer groups call on Commonwealth Bank to stop using its schools program as a lifelong marketing tool

4 October 2018


Consumer advocates are calling for the Commonwealth Bank to stop using schools to market banking products to children after CHOICE awarded the bank a Shonky award for the dodgy Dollarmites program. CHOICE, Consumer Action, Financial Counselling Australia and Financial Rights Legal Centre are calling on the bank's CEO Matt Comyn to remove bank-branded marketing from schools.

The Dollarmites program works by offering commissions to primary schools in exchange for running the school banking scheme. The commissions include a one-off payment of $200 when the first student makes their initial deposit, annual rewards of up to $600 a year and ongoing payments of $5 for every 10 deposits per student.[1]

Quotes attributable to Karen Cox - Coordinator, Financial Rights Legal Centre

"We need to ask, what lessons does the Commonwealth Bank have to teach our children? Based on what we've seen from the royal commission into financial services, the major banks know very little about treating customers fairly. The Commonwealth Bank charged more fees for no service than any other major bank. Like their competitors, they also sold insurance to people that were unable to use it, charged dead clients fees and kept customers in high-fee superannuation products, eroding their retirement savings."

Quotes attributable to Gerard Brody - CEO, Consumer Action

"Over the last year we have seen repeated scandals that show banks take advantage of loyal customers."

"We can no longer trust banks to teach children about the financial system, instead we need to be teaching children to avoid the high costs and bad practices we keep seeing from the big banks."

Quotes attributable to Fiona Guthrie - CEO, Financial Counselling Australia

"Schools need assistance to deliver independent financial literacy programs that help young people to explore and assess the different options in the market."

"If the Commonwealth Bank wanted to make a positive contribution to financial literacy they could sponsor genuinely brand-free education initiatives."

Quotes attributable to Alan Kirkland - CEO, CHOICE

"The Dollarmites program uses slick marketing to target primary kids at school, turning them into long-term customers of a bad-value bank. Once you factor in recent revelations that Commonwealth Bank staff fraudulently activated Dollarmite accounts for personal gain,[2] awarding them a Shonky was an easy decision."

"CHOICE has found that 35% of Australian adults still have their first bank account and this brand attachment often means they take out credit cards, home loans or other products with the same bank.3 46% of people got their first account with the Commonwealth Bank, a strong testament to the power of school banking programs."

Media contact: Jonathan Brown 0430 172 669

1 https://www.commbank.com.au/personal/kids/school-banking/information-for-schools.html?ei=bld2-btn-information-for-schools

2 https://www.smh.com.au/business/banking-and-finance/dollarmites-bites-the-scandal-behind-the-commonwealth-bank-s-junior-savings-program-20180517-p4zfyr.html