At least two million low-income customers will be refunded upwards of $28 million after an ASIC review found that four Australian banks charged high fees to bank customers who could least afford it.
ASIC’s Report 785, Better banking for Indigenous Consumers, revealed that the ANZ, Bendigo and Adelaide Bank, Commonwealth Bank, and Westpac caused financial distress by charging high fees and using complicated bank processes.
In July 2023, ASIC called upon banks with a presence in regional and remote locations to improve their processes and target market determinations (TMDs) and refund low-income customers in high-fee bank accounts.
The review was targeted at improving financial outcomes for First Nations consumers by addressing avoidable bank fees.
Following ASIC’s review, the four banks have moved over 200,000 customers into low-fee accounts.
Some $24.6 million of the $28 million will be refunded to customers receiving ABSTUDY payments and those in areas with large First Nations populations.
REP 785 is an outcome of ASIC’s Indigenous Outreach Program which works to encourage positive financial outcomes for First Nations peoples. It is the first project to command widespread benefits for low-income consumers, including First Nations customers since the release of ASIC’s Indigenous Financial Services Framework.