The corporate watchdog found four banks kept at least two million customers in high-fee accounts, even though they were eligible for cheaper products.
Four Australian banks will refund a combined $28 million to people on low incomes, including First Nations customers, after a review by the corporate regulator found the customers had been kept in high-fee bank accounts despite being eligible for cheaper products.
ASIC commissioner Alan Kirkland said the banks had caused financial distress through avoidable fees and complicated processes that often made managing money difficult for regional and remote customers. Banks had processes in place to identify low-income customers likely to be eligible for a low-fee account, but their processes for promoting that eligibility were ineffective in getting customers to migrate to the low-fee alternatives. Success rates were as low as 0.5 per cent.
The banks will refund more than $28 million in fees to these customers over the next 12 to 18 months, of which $24.6 million will be returned to those receiving ABSTUDY payments – a group of payments for Aboriginal or Torres Strait Islander students or apprentices – and those in areas with significant First Nations populations.
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