The Commonwealth Bank has temporarily halted plans to impose a $3 fee for cash withdrawals at branches and post offices. The announcement came after widespread criticism from political leaders and customers.
Fee Announcement Sparks Outrage
The Commonwealth Bank, Australia’s largest bank, revealed earlier this week that customers with “Complete Access” accounts would face a $3 cash withdrawal fee. The fee would apply at branches, post offices, and through phone banking starting January 2025.
Both sides of politics condemned the proposal. The federal government labelled it a “terrible decision” and a “kick in the guts” to customers during challenging economic times.
Bank Revises Approach
In response to the backlash, Angus Sullivan, Group Executive for Retail Banking Services at the Commonwealth Bank, announced a temporary pause on the changes. Speaking at a media conference, he apologised for the poor communication surrounding the decision.
“We feel that we didn’t get the communication right on this, and we want to take a more individual approach,” he stated.
Mr Sullivan explained that approximately 10% of the bank’s customers currently use the affected “Complete Access” accounts.
Who Is Impacted by the Fee?
The new $3 fee was tied to the migration of customers from “Complete Access” accounts to “Smart Access” accounts. Commonwealth Bank said that 90% of affected customers would be in a better or equal financial position under the changes.
“For those customers, we will continue with migrating them to the lower monthly account-keeping fee bank account option,” Mr Sullivan explained.
The bank plans to pause the migration for customers who might face financial disadvantages. Commonwealth Bank will spend the next six months engaging individually with these customers to tailor suitable banking solutions.
Fee Exemptions and Customer Support
The Commonwealth Bank clarified that the $3 withdrawal fee would not apply to Smart Access customers under 18 or those relying on services due to a disability.
In a statement, the bank noted, “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.”
Additionally, Commonwealth Bank reaffirmed its commitment to providing free cash withdrawals through its national ATM network.
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Focus Shifts Towards Specialist Centres
While denying plans to go cashless, the Commonwealth Bank has opened “specialist centres” that do not handle physical cash. Instead, these centres focus on products like business loans, home loans, and credit facilities.
The move comes as the bank disclosed a $410 million spend on cash services for the year ending June 2024. Of this amount, $350 million covered cash-on-hand expenses.
Customer Concerns About Going Cashless
Despite assurances from the Commonwealth Bank, many customers worry that the fee signals a broader push towards cashless banking. Critics argue that vulnerable groups relying on physical cash could face increased barriers.
The federal government continues to monitor the situation closely, urging banks to prioritise customer interests.
Future Changes Still Under Review
The Commonwealth Bank has not scrapped the $3 fee entirely but has committed to revising its implementation. The bank plans to engage individually with customers to ensure fair outcomes.
“We’re going to spend the next six months individually engaging with each of those customers,” Mr Sullivan said.
Customers unhappy with the proposed changes are encouraged to contact the bank to explore alternative account options.
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Commitment to Transparency
The Commonwealth Bank remains under scrutiny for its handling of the commbank withdrawal fee announcement. The bank has acknowledged the importance of clear communication and aims to restore customer trust.
While the Commonwealth Bank pauses the cash withdrawal fee, customers continue to express concerns about potential future banking shifts.
