Aussie banks to return $19 mln charged in high fee to low-income customers (updated)

Bendigo and Adelaide Bank

15/07/2024 01:36

(Recasts paragraph 1, adds details and background in paragraphs
2-7)
       July 15 (Reuters) - Four Australian banks will give back
a total of A$28 million ($18.95 million) to low-income
customers, after a review by the corporate regulator found these
customers had been kept in high-fee bank accounts despite being
eligible for cheaper products. 
    A report released by the Australian Securities and
Investments Commission (ASIC) on Monday said ANZ  ANZ.AX ,
Commonwealth Bank Of Australia  CBA.AX , Bendigo and Adelaide
Bank  BEN.AX  and Westpac  WBC.AX  had kept at least two million
customers in accounts under which they charged high fees.
    ASIC had in July 2023, wrote to the banks asking them to
improve their processes and refund past fees incurred by
low-income customers in high-fee bank accounts.
    "Banks knew that many of these customers on low-incomes were
in inappropriate high-fee accounts, and it has taken ASIC's
intervention to force them to act," said ASIC Commissioner Alan
Kirkland.
    Customers who receive certain government payments can
operate low-fee accounts under Australia's banking code of
practice. The report found that many of these customers have
remained in high-fee accounts, thereby hampering their savings. 
    The report also mentioned that following the review, the
banks have migrated over 200,000 customers into low-fee
accounts, thereby saving these customers about A$10.7 million in
future savings on a year basis. 
    ANZ, Bendigo and Adelaide, CBA and Westpac did not
immediately respond to a request for comment. 
    
($1 = 1.4773 Australian dollars)

 (Reporting by Rishav Chatterjee in Bengaluru; Editing by Rashmi
Aich)
 ((Rishav.Chatterjee@thomsonreuters.com;))