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Commission welcomes 'overdue' basic banking product

The Australian Catholic Social Welfare Commission gave qualified support to the Basic Banking Product introduced yesterday by the National Australia Bank (NAB), urging the entire retail banking sector to follow suit.

National Director Mr Toby O'Connor said: "Ever since the Prices Surveillance Authority Inquiry of the mid 1990s, this Commission has called for a fee-free account for low income Australians, to be introduced by all of the major banks. Since that time the community has seen minimal progress in terms of concrete banking products for low-income Australians.

The features of the NAB account announced yesterday include no account keeping fees, 13 free over the counter transactions per month, and no minimum monthly balance.

"This new account will benefit many low-income people including Pensioners, Veterans and Commonwealth Health Card holders," Mr O'Connor said. "However it is a great shame that a one-year waiting period will be imposed on new customers trying to access this product. This will remain a real problem until all other retail banks follow suit."

He described the new product as an important step toward a fairer deal for those struggling under current fees and charges.

Mr O'Connor continued: "In the spirit of the recent Australian Bankers' Association Social Obligation Action Plan, we call on the retail Banking Sector to honour their social obligation by enshrining this type of product as part of the banking landscape."

He concluded that legislation may be necessary if every bank does not cooperate by establishing a safety-net product.