(18 May 2010 – Australia) The Australian Greens will introduce new laws to guarantee consumers can access fee free basic bank accounts.Australian Greens Leader Bob Brown said news of a class action against banks over fee gouging showed the sector urgently needed to be reined in.
The Greens Delivering Essential Financial Services for the Community Bill 2010 would abolish the fees the class action by litigation funder IMF Australia is targeting.
While most banks have stopped charging the fees targeted by the class action, the Greens’ bill would ensure banks could not re-introduce them, or limit them to the cost to the bank of the penalised conduct.
The bill will also mandate against unfair mortgage exit fees, mortgage rate hikes and A$2 ATM fees.
Self regulation by the big banks is not going to protect the public, said Senator Brown.
The Greens bill would ensure that all banks must provide fee-free basic bank accounts and cap mortgage exit fees, added Senator.
Senator Brown noted that it would also stop excessive profiteering by banks on mortgages by forcing all banks to offer mortgages that link interest rates to the lender’s cost of funds so that the rate borrowers pay only increases by the amount lender’s costs increase.
The average Australian pays around A$1000 in bank fees every year, 22 percent more than in the UK and 10 percent more than the US.
Yesterday Senator Brown gave notice of his intention to introduce the bill to the Australian Senate in the next sitting.