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How to resolve AdBlock issue? Deadline looms today for NAB customers to register for compensation in class action
THE deadline for NAB customers to reclaim potentially millions of dollars in unfairly charged exception fees is fast approaching, with just 24 hours remaining according to Financial Redress, which is managing a series of class actions on behalf of bank customers.
James Middleweek, Managing Director of Financial Redress, said today that any NAB customers who believe they have been hit by excessive exception fees in the past should complete the registration process on www.financialredress.com.au by 4pm on Tuesday 27 January, so as not to miss out on any compensation.
NAB exception fees were on average around $30 before the bank reduced or eliminated them altogether in 2010.
More than 40,000 NAB customers have so far joined the NAB Class Action, which is part of a wider group of legal actions relating to exception fees launched against eight of the major banks in Australia. The lead case, against ANZ, is awaiting judgment in the Court of Appeal (class action members were successful in the Federal Court on late fees).
“When we launched the registration process for the Class Actions back in May 2010 the response was overwhelming. I commend NAB for its willingness to seek a settlement leading to compensation for its customers. It’s high time that the other banks followed suit.” Mr Middleweek said.
The deadline for NAB customers to join the proposed settlement comes as new research shows that Australian banks are charging Australians households six times more than the average person believes is fair, and twice as much as they think they are paying.
The research, conducted by Lonergan Research on behalf of Financial Redress and based on a survey of 1,026 people nationwide, found that Australians on average consider a reasonable level for bank fees to be $3 per month. They also estimate that they pay $8.70 per month in bank fees.
However, the latest Australian Bankers’ Association (ABA) data shows that Australian households in fact paid $4.14 billion in fees in 2013, which equates to an average monthly fee of $19.05 per person.
Mr Middleweek said that the research showed that the practice of banks charging excessive fees in general remained a massive sore point.
“According to the survey 90% of respondents believe that banks should charge lower fees even if it means they are less profitable,” he said.
“Most consumers understand the fairness of paying a reasonable fee when it reflects the bank’s costs. However, they object to being hit with an excessive fee, especially when it appears unlinked to the amount in question or the time period involved.”
The survey found that dishonour fees (a charge imposed by banks for refusing to honour a transaction) are the biggest point of frustration for Australians, with almost half (46%) of respondents considering these fees to be ‘unacceptable’.
Two in five (41%) respondents indicated they would prefer not to have the ability to overdraw or go over their limit at all. The remainder of respondents declared they would, on average, be willing to pay up to $5.70 when they overdraw, go over limit or pay a credit card late.
“It is hard to believe that banks routinely used to charge customers $30 to $40 in these situations. Some still do charge that much and nearly all charge much more than $5.70,” Mr Middleweek said.
Mr Middleweek also pointed to banks’ pursuit of higher fees aimed at Australian small businesses.
According to the ABA, Australia’s approximately two million small businesses paid $4 billion in bank fees in 2013, compared with $3.2 billion in 2009 - a 25% increase.
“This means the average small business in Australia is paying on average $2,000 per year, or $166 a month, in bank fees,” Mr Middleweek said.
“Collectively, banks are charging Australian households and small businesses $8 billion in fees each year,” he said.
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