Pressure mounts on CBA as executive defends $3 branch ...
The Commonwealth Bank is under growing pressure from politicians to reverse a $3 fee it imposes on cash withdrawals from branches.
The bank’s head of retail services Angus Sullivan was grilled on Nine’s A Current Affair program on Tuesday night after CBA announced changes that will mean more customers face the $3 “assisted withdrawal” fee for taking out cash at branches.
Commonwealth Bank’s group executive for retail banking services, Angus Sullivan.Credit: Channel Nine
While he said the fee, which doesn’t apply to ATM withdrawals, would affect a small minority of customers, he admitted the fee would help CBA cover the expense of handling cash in branches.
“I appreciate that even for 1 per cent of our customers, a change sometimes isn’t welcome and we’ve got a range of options to help those customers,” Sullivan said.
“The folks on government concessions are excluded from these changes, and we’ve got a range of fee-free cash handling options in our branches at our ATMs, supported by our customers to help them make sure that they can do their banking as economically as possible.”
This week CBA announced it will close an account called “Complete Access” and move customers in the product to its main transaction account called “Smart Access”, which charges a $3 fee for an “assisted withdrawal”, such as those occurring through a branch or via telephone banking.
Sullivan said the move to close the product affected 10 per cent of its customers, and of those, he argued 90 per cent would be better off or neutrally affected by the change.
The move has sparked a backlash from politicians, with Financial Services Minister Stephen Jones on Tuesday slamming it as a “terrible decision” by the country’s biggest bank.
More politicians slammed the move on Wednesday, with Finance Minister Katy Gallagher telling ABC TV the federal government will take a “close look” at CBA’s decision and hoped that the bank could “rethink” the fee.
Meanwhile, opposition frontbencher Ted O’Brien said on Wednesday that the fee would disproportionately affect older Australians, who are already affected by the reduction of bank branches. “I think, for them to be stung by the $3 [fee] is certainly worthy, at least, of a serious rethink on behalf of the bank,” he said on ABC TV.
Financial Services Minister Stephen Jones.Credit: Dominic Lorrimer
As the government pushes ahead with policies to ensure cash remains part of the Australian payment system, Jones on Tuesday declared CBA’s move a “kick in the guts” to customers.
“Commonwealth Bank has to rethink this terrible decision. It seems to me to be a tax on Australians who demand the right to use their cash, and the government won’t stand for it,” Jones said.
Jones said Australians should have access to banking services wherever they live, including going to the bank branch.
“So, we say to the Commonwealth Bank, this is the worst Christmas present ever. It’s a kick in the guts to your customers.”
CBA has stressed that cash withdrawals from the bank’s ATMs are free, the $3 fee had not changed, and that people on government payments such as the pension would be exempt from it. The bank says 99 per cent of customers switching to the Smart Access account will be “no worse off or slightly to the better thanks to lower monthly fees”.
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Sullivan denied customers were being “punished” for using cash, arguing there was a cost to providing the service.
“Ninety-five per cent plus of our customers don’t use over-the-counter service, and they opt for fee options that don’t include paying for this service,” he said.
“I understand that there’s emotion around it and the last thing that we want to do is upset our customers. The reality is there’s also a cost associated with providing this service.”
National Australia Bank said it did not charge fees for assisted withdrawals and Westpac said it didn’t charge the fees for retail bank customers.
ANZ Bank applies a $2.50 fee for “staff-assisted” withdrawals for some products including certain savings accounts, but its everyday transaction account does not impose the fee.
Amid the declining use of cash, the government last month unveiled a plan that would mean shops would be required to accept cash for essential goods and services.
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