The Commonwealth Bank no longer plans to charge customers a $3 fee to withdraw their own money after the decision provoked backlash.
It had said that, from 6 January, customers with a Complete Access account would be automatically moved to Smart Access accounts.
That account includes an "assisted withdrawal fee" of $3 to take out money from bank branches and post offices.
The bank's announcement was met with criticism on Tuesday, with assistant treasurer Stephen Jones
and Labor minister Clare O'Neil saying the proposal was a "kick in the guts".
Now, less than 24 hours after the announcement, the bank has changed tack.
The bank's head of retail services conceded it had done a "poor job" communicating the change to customers. Source: AAP / Erik Anderson
Angus Sullivan, the bank's head of retail banking services, said that for the estimated 100,000 customers who would have been worse off due to the change, it will not come into place for at least six months.
"Those we expect might be slightly worse off and need more support in making sure their banking arrangements are appropriate, we're going to pause the changes we announced," Sullivan said.
"We're going to spend the next six months individually engaging with those customers to make sure we have a solution tabled for each one of them rather than a simple migration across to a Smart Access account."
Sullivan conceded the bank had done a "poor job of communicating this change to our customers".
"We are particularly conscious of the impact any change to planned fees and charges can have at this time of year, especially given the cost of living pressures our customers face," he said.
The bank had said the withdrawal fee would be waived if the customer was under 18, had an age, service or disability pension or a disability that required them to use a branch.
The Commonwealth Bank said it would also continue to offer customers free cash withdrawals from its national ATM network.
