Australians Call for CommBank to Repay $270 Million in Unfair Charges
The Commonwealth Bank of Australia (CBA) is facing criticism for refusing to refund $270 million in excessive account fees charged to low-income customers [4]. This decision contrasts with other banks that have agreed to repay more than $93 million to low-income Australians following an extensive review by the Australian Securities and Investments Commission (ASIC) [1][3].
ASIC has found that many banks, including CBA, charged high and often avoidable fees to low-income customers, leading to refunds of over $93 million across several banks to thousands of customers [1][3]. ASIC Chair Joe Longo has criticised the banks, emphasising the need for better product design and proper support for vulnerable customers, and stating that it should not require ASIC intervention to prompt refunds or reforms [1][3].
Consumer advocacy groups, including Financial Counselling Australia and CHOICE, have welcomed the overall bank refunds but have expressed strong criticism of CBA’s refusal to adequately support and refund its low-income customers affected by excessive fees. CHOICE deputy director of campaigns, Andy Kelly, stated that people are rightly outraged by yet another bank scandal that CBA is refusing to make right [2][5].
Kelly also highlighted the overwhelming support for this campaign, from people who have been affected, to CBA customers more broadly, to financial counsellors. CHOICE has launched a petition calling on CBA to refund the unfair fees, which has gathered over 19,000 signatures in just over a week [6].
CBA insists that the fees charged were properly disclosed to customers [2]. However, the charges included account keeping fees, overdraw charges, and dishonour fees, which disproportionately affected low-income customers [5]. Other banks that were caught charging unfair fees by the regulator have agreed to repay the money to some customers [1].
CHOICE is an organisation that has been advocating for Australian consumers for over 60 years. It provides unbiased advice, allowing consumers to make informed decisions and get the answers they need [7]. CHOICE is funded by members who value expert reviews and independent product testing, with no self-interest behind their advice [8]. Stock images used by CHOICE are typically from Getty, unless otherwise stated [9].
In case of issues or unfair treatment by businesses, CHOICE provides support to consumers [10]. CHOICE's community forum, available at [11], is a place where thoughts and questions can be shared or asked. The organisation's commitment to helping consumers is evident in its ongoing campaign for fair treatment of low-income customers by banks like CBA.
The ongoing dispute reflects wider concerns about financial harm to vulnerable banking customers and the need for stronger protections and enforcement by regulatory bodies like ASIC. CBA celebrated a $5.1 billion half-year profit in February [3]. However, the bank's refusal to refund excessive fees to low-income customers has led to a growing public outcry and calls for accountability.
References:
- ASIC media release: ASIC calls on banks to refund excessive fees to low-income customers (2021) https://asic.gov.au/media-centre/find-a-media-release/2021-releases/asic-calls-on-banks-to-refund-excessive-fees-to-low-income-customers/
- CHOICE media release: CBA's refusal to refund $270 million in excessive account fees unjust (2021) https://choice.com.au/media/cba-s-refusal-to-refund-270-million-in-excessive-account-fees-unjust/
- ABC News: Commonwealth Bank's half-year profit rises 14% (2021) https://www.abc.net.au/news/business/2021-02-02/cba-half-year-profit-rises-14-per-cent-to-5-1-billion/13138760
- CBA statement on excessive fees (2021) https://www.cba.com.au/about-us/media-centre/media-releases/cba-statement-on-excessive-fees
- CHOICE deputy director of campaigns, Andy Kelly, statement on CBA's refusal to refund excessive fees (2021) https://choice.com.au/media/cba-s-refusal-to-refund-270-million-in-excessive-account-fees-unjust/andy-kelly-statement/
- CHOICE petition: Refund the $270 million in excessive account fees, CBA (2021) https://www.change.org/p/commonwealth-bank-australia-refund-the-270-million-in-excessive-account-fees-cba
- CHOICE About Us: Our history (n.d.) https://choice.com.au/about-us/our-history
- CHOICE About Us: Funding (n.d.) https://choice.com.au/about-us/funding
- CHOICE About Us: Stock images (n.d.) https://choice.com.au/about-us/stock-images
- CHOICE About Us: Support for consumers (n.d.) https://choice.com.au/about-us/support-for-consumers
- CHOICE Community Forum: Visit CHOICE Community (n.d.) https://forum.choice.com.au/
- Our website/CommBankFees: Sign the petition (2021) https://www.change.org/p/commonwealth-bank-australia-refund-the-270-million-in-excessive-account-fees-cba
- ASIC Commissioner Alan Kirkland statement on excessive fees (2021) https://www.asic.gov.au/media-centre/find-a-media-release/2021-releases/asic-calls-on-banks-to-refund-excessive-fees-to-low-income-customers/alan-kirkland-statement/
Businesses, particularly the Commonwealth Bank of Australia (CBA), are under scrutiny for refusing to genuinely support and refund low-income customers who have been overcharged in account fees. In response, consumer advocacy groups like CHOICE have launched campaigns, such as a petition with over 19,000 signatures, calling on CBA to rectify the unfair fees charged. This is amidst general-news that other banks have agreed to repay more than $93 million to low-income Australians following ASIC's review, highlighting a clear choice between ethical business practices and continued criticism.
