Banks Quiet On Credit Card Fees
Sydney Morning Herald
Sunday August 1, 1993
The State Bank of South Australia is the first to take advantage of new legislation and announce that it definitely will be introducing fees on its credit cards.
A final draft of the Uniform Consumer Credit Act, governing all types of consumer credit, such as personal loans and credit cards in each State, was released by the nation's consumer affairs ministers last Friday.
But after years of badgering the Federal Government to legislate in favour of credit card charges, the other major banks are being tight-lipped about any changes they plan to make.
While it is expected that all of the major banks will introduce fees on at least some of their credit cards, it is a move that is certain to be unpopular with customers.
"I think there will be a bit of waiting to see what everyone else does,"said the corporate spokeswoman for the ANZ Bank, Ms Sue McCarthy.
Commonwealth Bank spokeswoman Ms Lyndell Deves agrees. "It's a very competitive industry and everyone is playing their cards close to their chest."
All the banks have been surveying their customers to discover their attitudes to credit card fees, and what mix of lower interest rates and fees they would accept.
While the bill is not expected to be enacted until next year, the States have passed a separate exemption order, under pressure from the Federal Government, specifically allowing banks and other financial institutions to charge fees for credit cards from August 1 this year.
A spokesman for Westpac, Mr Rod Metcalfe, said he did not expect anything to change at Westpac for at least another six weeks.
NAB spokesman Mr Haydn Park said while there was a certain element of waiting to see what the opposition was going to do, "at some stage you've got to bite the bullet".
Alone among the banking community, the Advance Bank has said it will not be introducing credit card fees - at least, not for its current customers.
"We will not be placing a fee on our present credit card holders," said Mr Arthur Delbridge, assistant general manager with Advance Bank.
"Our research showed that one of the things that irritates our customers are fees and charges."
However, he did not rule out the possibility of a fee if the bank introduced a new card in the future.
A spokesman for the Australian Consumers' Association, Mr Robert Drake, has warned customers to keep a close eye on their credit card statements over the coming month.
"None of the big banks really want to be the first to cop the worst publicity," Mr Drake said, "but when they do decide to go (charge fees) they have to give some advance warning."
Mr Drake said that while the banks have talked of a credit card fee in the range of $30 to $40 a year in the past, he suspects they may introduce monthly fees of around $4 per month, to make the fee appear smaller.
© 1993 Sydney Morning Herald
