ABA SAYS BANKS ALREADY MEET MOST OF ALP CONSUMER AFFAIRS POLICY Sydney, 3 October, 2001: The Australian Bankers’ Association says banks have already met most of the Australian Labor Party’s Consumer Affairs Policy which was today announced in Sydney. Ian Gilbert, Acting Chief Executive of the Australian Bankers’ Association, said the policy re-states some of the ALP Banking Policy proposals announced back in March. Fee Disclosure “The Australian Bankers’ Association (ABA) says banks have always supported the principles of transparent fee disclosure, ” Mr Gilbert said. “In terms of the full disclosure of fees of fees and charges, Australian banks disclose fees and charges, as a matter of course, in the terms and conditions of the bank product which customers choose.” “Most retail banks subscribe to the Code of Banking Practice and the Electronic Funds Transfer Code of Conduct, both self regulatory codes, to back up full disclosure.” “The ABA, member banks, consumer groups and regulators together worked on an initiative to improve transparency - the Australian Securities and Investment Commission's Draft Guide to Good Transaction Fee Disclosure.” "The proposals included in the ASIC draft Guide will provide customers with the opportunity to better understand the fee structures applying to their accounts so they can make more informed choices." "Banks support and will implement the proposals for improved fee disclosure covering statements, Internet banking, telephone banking, disclosure of ATM fees when customers use an ATM other than one which belongs to their bank, and disclosure of ATM and Electronic Funds Transfer surcharges." Mr Gilbert said real time fee disclosure would be possible in the future as technology develops but it should be driven by customer demand. Effective comparison rates "It is interesting to note that the New Zealand Labor Government recently decided to dispense with the comparison rate in their consumer credit legislation, because ‘consumers have not always been comparing apples with apples’, with mandatory comparison rate disclosure," Mr Gilbert said. “On shopping for loans, consumers need to recognise that the comparison rate is just one of the many factors that they can use, but don’t assume the comparison rate by itself is going to tell you how much your loan is going to cost, or if the loan is right for you.” Mr Gilbert said experience tells us that there are many factors consumers take into account when looking for the right loan: The experience of others with a lender; How much the monthly repayments will be; And whether it would be cheaper to combine other products with the loan. Social charter “The ABA says the banking industry has substantially met most of the ideas contained in the ALP’s banking policy and we do not believe any further regulation is necessary,” Mr Gilbert said. “Back in March, the ABA announced on behalf of its Member Banks an Action Plan to ensure low-income and vulnerable Australians have access to fee free banking.” “The safety net basic bank account initiative will provide five million eligible Australians bank accounts that meet minimum guaranteed service standards, including the capacity of fee-free banking within reasonable limits.” Mr Gilbert said the ABA standards for a safety net, basic bank account are: No monthly account servicing fee; Unlimited free deposits; Guaranteed minimum of 6 non-deposit transactions, of which 3 can be over-the-counter. Any Australian who is eligible for a Commonwealth Government Health Card, a Commonwealth Pensioner Concession Card, or a Commonwealth Senior’s Card is eligible for the account. Some banks have announced their own accounts that go above and beyond these benchmarks. For Further Information Contact:   Heather Wellard ABA PR Phone: 02 8298 0411 Mobile: 0409 830 439   ENDS