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Consumer advocates have welcomed a commitment from Australian banks to refund more than $93 million to low-income customers after charging excessive fees, but significant gaps in support remain, with one of the big four falling short.

ASIC’s second bank-fee report, released today, details banks’ responses to excessive fees charged on transaction accounts – potentially impacting millions of Australians.

“We’re pleased to see there has been meaningful action from the banks since ASIC’s first report, leading to improvements for the First Nations customers who were the initial focus,” said Lynda Edwards, Financial Counselling Australia’s Director of First Nations Policy.

“Overall, these reports have been a powerful tool to help hold banks to account.”

Dr Domenique Meyrick, co-CEO of Financial Counselling Australia, commended the action of banks who have committed to refunding customers who were over-charged and ensuring they can access appropriate products in future.

“This $93 million in refunds will make a big difference for the customers receiving it, who have to make do each day with very little,” she said.

“But big problems remain in the banking sector’s response, with the Commonwealth Bank of Australia (CBA) refusing to adequately support its low-income customers who have been affected.

“It’s a glaring standout that Australia’s largest and most profitable bank is not doing the right thing by its low-income customers. This is just not good enough.”

Ms Edwards said CBA needs to carefully consider its practices moving forward.

“Many First Nations people bank with CBA, so it’s crucial that it offers culturally appropriate support,” Ms Edwards said.

“At the end of the day, CBA is prioritising profits over people. This has to stop.”

“The banks commitment to refund $93 million sends a message that banks are taking seriously their responsibility to customers they overcharged but there is a very long way to go before they reach community expectations on how to deal fair with vulnerable customers,” said Consumer Action Law Centre CEO, Stephanie Tonkin.

Financial Counselling Australia and Consumer Action Law Centre urge the banks to ensure low-income customers have access to overdrafts and low fee accounts, as well as being proactive about migrating these customers to products that better suit their needs.

ENDS