Major Australian bank under fire over decision to charge for cash withdrawals

A recent move by Commonwealth Bank (CBA) to charge customers $3 to withdraw their own money has drawn the ire of the public, with the decision being described as “the worst Christmas present imaginable”.

Beginning January 6, customers with a Complete Access account will be automatically transitioned to Smart Access accounts.

The Smart Access account introduces an “assisted withdrawal fee,” charging customers $3 when they withdraw cash at bank branches, post offices, or over the phone.

The bank has confirmed that the fee will be waived for customers under 18, those receiving an age, service, or disability pension, or individuals with a disability necessitating branch access.

“Our Smart Access account has a $3 assisted withdrawal fee. This is our main transaction account and the assisted withdrawal fees on that account have not changed,” the bank said in a statement, adding that free cash withdrawals will remain available through its nationwide ATM network.

“We continue to offer waivers on assisted withdrawal fees for customers who meet certain criteria, including certain types of pension recipients and those under 18 years of age.”

However, the decision has been met with swift condemnation, particularly by Assistant Treasurer Stephen Jones who labelled the move the “worst Christmas present imaginable”.

“This is a kick in the guts for ordinary Australians and the worst Christmas present imaginable,” Jones told reporters in Sydney on Tuesday, December 3.

“This 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.

“If they want to go in and see their bank branch, Australians should have access to banking services wherever they live.”

The furore over Commonwealth Bank’s new fees comes as trust in major banks remains under scrutiny after several institutions were recently ordered to refund over $28 million to customers after they were found to have overcharged low-income Aussies.

The refunds came after the Australian Securities and Investments Commission’s (ASIC) Better Banking for Indigenous Consumers report found that the ANZ, Bendigo and Adelaide Bank, CBA and Westpac kept at least two million Australians on low incomes, including many who relied on Centrelink payments to make ends meet, in high-fee accounts.

ASIC Commissioner Alan Kirkland stated that the banks’ actions had led to financial distress due to unnecessary fees and complicated banking procedures, frequently creating obstacles for consumers in regional and remote areas.

“Banks knew that many of these customers on low-incomes were in inappropriate high-fee accounts, and it has taken ASIC’s intervention to force them to act,” Kirkland said at the time.

“Before our review, most banks only provided their customers with difficult ‘opt-in’ processes for switching to low-fee banking options, including forcing some consumers to travel hundreds of kilometres to their nearest bank branch.”

ASIC encourages all consumers to contact their bank to discuss what fees they are paying.

-with AAP.