Pricey fees, poor customer service and high interest rates on credit cards were among the top gripes of banking customers, a Senate inquiry has heard.
The cases of more than 1300 people were presented by CHOICE today to a
Senate inquiry examining consumer protection in the banking, insurance and
The submissions provided a first-hand account into how banks are failing
everyday consumers, says Alan Kirkland, the chief executive of CHOICE.
"We wanted senators to hear first-hand from the people struggling to get a
fair go from a banking sector that has lost touch with its customer base.
"The issues raised in the submissions talk to the poor culture in the
The most common issue among the 1318 submissions was high fees (37%),
followed closely by poor customer service (29%).
One example provided by Kirkland involved a customer being charged a $12
fee for missing a $9 direct debit.
Other pain points felt by customers include the high rate of interest
charged on credit cards (24%) and a belief profit margins are too high for
CHOICE called for reform in the industry to service the needs of
customers, with Kirkland using a report on mortgage broker behaviour as an
The 234-page report by the financial regulator found brokers routinely
failed to act in the best interest of clients because they were
incentivised by commission payments.
"It's clear major cultural change is needed in a banking sector that has
put customer care last for far too long," he says.
"We urgently need sweeping reforms to the industry, and we believe the
government should intervene to introduce real competition in the sector."
Submissions to CHOICE were made throughout February and
March; 771 were public and 541 people chose to keep comments confidential.