“CHOICE welcomes ASIC’s comprehensive review into school banking programs.
This is the first time ever in over a century that these school-based
marketing schemes have been reviewed,” says CHOICE CEO Alan Kirkland.
“ASIC has painted a damning picture of school banking programs, making it
clear that a key objective of programs is to recruit customers at a young
“ASIC found that banks like the CBA fail to be transparent about their
commercial objectives, and haven’t even bothered to evaluate the
effectiveness of their programs.
“Most importantly, ASIC has warned school communities not to rely on claims
that these programs help kids to develop good savings habits, describing
these as ‘unsubstantiated’.
Put simply: these programs exist to capture lifelong customers,” says Mr
“We know that long-term, loyal customers pay more than other customers, so
the most important lesson we can teach young people is to shop around.
Encouraging them to sign up to one of the big four banks at a young age is
just about the worst thing you could do.”
Four key takeaways of ASIC’s review:
- There is no evidence that school banking schemes improve the savings
habits of participants. ASIC called bank advertising about improving
savings habits “unsubstantiated.”
- ASIC found these programs are a “marketing exercise for the financial
institutions that offer them.” Banks use rewards and prizes to “develop
attachment to brands.”
- Payments from banks for involvement in a school marketing scheme creates
a “conflict of interest” that incentivises schools to encourage more
- CBA is now the only major provider of school banking left, with over 92%
market share. Bendigo and Adelaide Bank, IMB and South West Credit have
wound up their school banking programs as a result of the ASIC Report and
Northland Inland intends to wind up its program.
“We welcome other providers like Bendigo and Adelaide Bank winding up their
school marketing programs in light of this ASIC review. That is the ethical
thing to do. CBA should follow their lead and stop paying money to schools
to get them to sign up primary school children as customers,” says Mr
CHOICE welcomes Victoria’s recent announcement banning school marketing
schemes from schools.
“The evidence of harm to our children and the Australian community is
clear. We are calling on the States and Territories to follow Victoria’s
lead and ban bank marketing schemes from their schools. We need
evidence-based financial literacy programs that help our kids, rather than
setting them up to be ripped off later in life,” says Mr Kirkland.
Media contact: 0430 172 669, email@example.com
In 2019 over 500 teachers, parents and community members have helped CHOICE
expose the flaws in school banking and shared their perspectives with