Australia limits all bank fees

by Richard Alderman

I just finished teaching a course on American Consumer Law at Latrobe University in Australia. Part of the fun of teaching in another country is comparing consumer issues. One common problem is unreasonably high bank and credit card fees. It looks like Australian consumers also face excessive fees for services, such as NSF checks, late payments or overdrafts. The Australian government has proposed broad unfair contracts rules to deal with this problem. Last week, a recent newspaper headline read, "New law puts $1B in bank fees at risk." It discusses the new law, which goes into effect in January, allowing consumers to challenge any bank fee believed to be "unreasonable." If a fee is challenged, the bank must reveal the actual costs involved with such fee to establish that the fee was reasonable. It is expected that the law will have the effect of substantially lowering fees for every type of bank account, credit card, personal loan or mortgage, which have been a large profit center for banks. Looks like when it comes to banks, consumers are a worldwide profit center.

Comments

[Giles Pickford]

The proposed class action on the banks is a far worse scandal that the tax on miners.

The Banks have managed their affairs well during the recession and during the darkest days they were four of the eight world banks that were Triple A-Rated. The other four were Chinese.

They charged us what was necessary and they stayed afloat. The thanks they will get, courtesy of the legal profession, is an immense headache. Hundreds of thousands of mums and dads will get a few hundred dollars and the Lawyers will get millions.

This is a transfer of wealth from public to private. The public will get enough money to live on for a few days and the Lawyers will make a fortune.

It is absolutely disgusting and I will have none of it.

Giles Pickford