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Customer owned banking institutions become Australia Post’s latest target

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Australia’s customer owned banking institutions are being pressured to agree to an unfair pricing policy by Australia Post as it targets smaller institutions to pay excessive charges for access to Bank@Post.

Despite Australia Post CEO Christine Holgate publicly ruling out applying a Community Representation Fee (CRF) to smaller banking institutions in front of a Senate Estimates Committee in October last year, customer owned banking institutions are being pressured to agree to colossal new fees.

Under Australia Post’s scheme, mutual banks and credit unions will be forced to either pay a tremendously exorbitant CRF or their customers will no longer be able to do their banking via Bank@Post.

The fees are so significant and disproportionate that in some cases they equate to almost 80 per cent of annual profit. This is compared to approximately 0.2 per cent for the ‘Big Four’ banks.

Customer owned banking institutions were initially given a handful of weeks to make a decision, however Australia Post has committed to a two-month extension. The extension is a welcome concession after the ‘Big Four’ banks received nine months to review and consider three different proposals.

Australia Post’s tactics are expected to primarily impact older Australians, particularly in rural and regional areas. For one member, 70 per cent of its customers that transacted via Bank@Post for the 2018 calendar year were 50 years of age or over. Of that group 66% were over 60 years of age.

CEO of the Customer Owned Banking Association Mike Lawrence said members were willing to pay their fair share but shouldn’t be picking up the tab for the ‘Big Four’s’ branch closures.

“The way Australia Post has engaged with customer owned banking institutions is certainly surprising from an organisation that the CEO claims is Australia's most trusted brand.

“Customer owned banking institutions are happy to pay their fair share for a service, but should not be forced to cover costs created by the ‘Big Four’ banks.

“The major banks are responsible for the vast majority of branch closures, 85 per cent of Bank@Post transaction volumes and bank most of the small business clients that rely on large cash floats.

“It should fall to them, not smaller banking institutions that primarily use Bank@Post for retail consumers, to make up the cost short-fall.

“After failing to get all of the ‘Big Four’ to sign onto the new pricing model Australia Post has put the pressure on smaller customer owned banking institutions to cover fees that are being generated by the ‘Big Four’.”

Mr Lawrence said COBA members were urging the Government to intervene to protect consumers in regional areas and maintain competition in the banking sector.

“This behaviour will have an enormous impact on Australians in regional and rural areas. If smaller institutions are forced to withdraw, customers will be forced to travel long distances to do their banking, or where that isn’t an option, have to switch banks.

“If the Financial Services Royal Commission taught us anything, its that customers need and deserve access to trusted banking alternatives.

“We’re hoping the Government can use its shareholding in Australia Post to stop the postal service from eroding competition in the banking sector.

“It’s clear that Australia Post has forgotten its role is to meet the needs of Australian communities. Hopefully the Government can remind it of its purpose.”


Customers of customer owned banking institutions have been urged to write to Australia Post CEO Christine Holgate and Communications Minister Mitch Fifield to demand a fairer pricing system by visiting: fairbankingaustralia.com.au

For more information please contact:

Mick Gibb
Corporate Affairs Manager
02 8035 8444 or 0423 149 494
This e-mail address is being protected from spambots. You need JavaScript enabled to view it

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Media Contacts

Ashley Penny
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