Australian banks will refund over $93 million to low-income customers for charging excessive fees, but ASIC has expressed disappointment as the Commonwealth Bank refuses to remit past charges amounting to $270 million.
The Australian Securities and Investments Commission (ASIC) has expanded its nationwide bank fees review, revealing systemic failures affecting over 920,000 customers.
This follows ASIC's initial report, which exposed Commonwealth Bank, Westpac, Bendigo Bank, and ANZ knowingly retaining over 150,000 Indigenous customers in high-fee accounts despite eligibility for minimal-charge options, prompting $33 million in initial refunds.
The latest report commits ANZ to $47.9 million, Westpac to over $9.9 million, and Bendigo Bank to $155,000 to be reimbursed to eligible customers.
Over one million customers have transitioned to low-fee accounts, projected to save them $50 million a year collectively.
Banks must also remove access barriers, such as branch visits or concession card requirements.
CommBank disappoints
ASIC says it's disappointed that Commonwealth Bank and its subsidiary Bankwest will not process refunds for newly identified customers.
Instead, the bank plans to shift 1.5 million eligible customers to a new nominal-fee account.
“That will address problems going forward... but what it doesn't do is set things right for the fees they've been charged in the past,” ASIC commissioner Alan Kirkland said.
“That is extremely disappointing.”
Watchdog stays eyes on banking
Australia's banking sector, with assets exceeding $5 trillion, faces heightened regulatory scrutiny amid declining household fees.
The big four banks hold 80% market share, but interventions like this highlight vulnerabilities for low-income groups.
This underscores the profitability pressures from consumer protection trends, potentially reducing fee income by 2-3%.
Reputational risks loom, with ASIC signalling ongoing enforcement.
Share prices show caution with CBA at $173.58, NAB at $37.68, Westpac at $33.08, and ANZ at $30.18, amid sector volatility.
