Aussie banks cut fees

First it was the NAB. Now the big four aussie banks are looking at cutting account withdrawn fees to appease customers.

Preceding new legislation that will demand from banks justification for fees customers believe are unfair, NAB will be scrapping its $30 overdrawn fee starting 1 October. According to a report by The Age, ANZ, Westpac, and the Commonwealth Bank are reviewing their penalty fees and are likely to follow in NAB's footsteps. St George Bank's fees are also under review.

Amounting to $1.2 billion, the penalties paid to banks in 2008 for overdrawing and non-payments make up approximately 10 percent of total banking fees, according to the Reserve Bank. NAB personal banking executive Lisa Gray said the decision to scrap the fees for 700,000 customers will take $100 million from the bank’s bottom line.

Customers who exceed the available balance in their accounts by having amounts automatically deducted without sufficient funds or by spending more than they have are normally charged up to $45 for overdrawing.

An ANZ statement said, "We are aware of the customer concern about the issue of exception fees and we're in the process of examining a range of options, with an outcome expected in the near future." Westpac, on the other hand, had been reviewing its fee structure and had scrapped the fees on its basic bank accounts. The Commonwealth Bank, which was about to announce a significant reduction of its overdrawn account fees, is reviewing its position given recent developments.

The Consumer Law Action Centre and Choice, consumer advocates campaigning for fairer bank fees, are urging more banks to head towards the same direction.