ANZ fails COVID fairness test
Consumer advocate Choice has ranked Australia’s Big Four banks on their COVID-19 responses with ANZ scoring the worst.
The COVID Fairness Scorecard compared the banks’ actions in helping Australians navigate financial hardship arising from COVID-19.
ANZ’s score was 46%, followed the Commonwealth Bank of Australia (CBA) (47%), National Australia Bank (NAB) (53%) and Westpac (59%).
Choice had called on the banks to refund interest accrued on deferred loans for all people in financial hardship, cut exorbitant interest rates on credit cards to reflect current cash-rate, end the marketing of harmful balance transfer credit cards, and waive debts for people in long-term financial hardship.
Alan Kirkland, Choice chief executive, said the banks needed to do more as people struggled to manage their finances after a significant drop in income.
“While their marketing teams have been quick to tell the community how they’re helping, our analysis has found a lot left to be desired in their COVID-19 responses,” Kirkland said.
“ANZ came last in the Choice COVID Fairness Scorecard. In particular, Choice experts found ANZ continued to take advantage of credit card customers with outrageously high interest rates."
Kirkland also said CBA did poorly due to its decision to switch all mortgage customers to minimum repayments without their consent.
“This careless decision means many people, irrespective of whether they are in hardship, will pay more interest over a longer time. Customers should have been given a choice," Kirkland said.
Westpac and NAB had scraped through with a pass, but Kirkland said there were still many areas for improvement.
“Despite landing the top spot, Westpac has the most expensive credit card on the market, at the eye-watering rate of 20.49%, while NAB’s supposedly low rate card comes with a 12.99% interest rate,” Kirkland said.
“In a rare example of industry leadership, Westpac deserves to be applauded for its decision not to charge interest on personal loans and credit cards for people who have had repayments paused.
“This means that their debts won’t keep growing while they are getting their finances back on track.”
Recommended for you
It can be extremely hard to realise the gains from financial advice M&A, according to Peloton Partners’ Rob Jones, and more could be gained from firms looking inward at their own practice.
With platforms reporting their quarterly results, there is a clear divide in the adviser markets they are targeting, according to platform specialist Recep Peker, and which would be right for your clients.
The Federal Court has imposed a $10 million penalty on Macquarie Bank for failing to prevent and control unauthorised fee transactions by third parties including financial advisers.
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
