The Australian Competition and Consumer Commission (ACCC) issued a draft determination proposing to grant authorisation AA1000683, subject to conditions, allowing Australian Banking Association Ltd (ABA) member banks to make agreements under the Banking Code of Practice covering basic accounts and default interest charges on agricultural loans. The ACCC proposes a five-year authorisation, finding the conduct is likely to deliver public benefits including improving the prospect of reprieve for farmers in drought and other natural disasters and, with conditions, increasing access to affordable banking services for low-income customers. Basic accounts are described as low or no fee transaction accounts with minimum features including no account keeping fees, free periodic statements, no minimum deposits (subject to benefit-payment requirements), free direct debit facilities, access to a widely accepted debit payment method at no extra cost, and free and unlimited Australian domestic transactions. For holders of a Commonwealth Seniors Health Card, Health Care Card or Pensioner Concession Card, additional features may include no informal overdrafts (unless impossible or reasonably impractical to prevent), no dishonour fees, and no overdrawn fees (while interest may still be charged on the amount in debit). Proposed authorisation conditions would require member banks to not charge or refund interest on informal overdrafts on basic, low fee or no fee accounts, to take reasonable steps at least annually to identify and directly contact customers who are or may be eligible for these accounts but do not hold one, and for the ABA to report to the ACCC on specified metrics including certain informal overdrafts without customers’ agreement, changes in the number of member banks offering basic accounts, outreach steps, and uptake. Submissions on the draft determination and proposed conditions are invited by 18 April 2025. Interim authorisation (with conditions) granted on 4 December 2024 remains in place until the final determination takes effect or is revoked.
Australian Competition and Consumer Commission 2025-03-31
Australian Competition and Consumer Commission proposes five-year authorisation with conditions for Australian Banking Association banks to coordinate on basic accounts and agricultural loan default interest charges
The ACCC issued a draft determination proposing a five-year authorisation for Australian Banking Association Ltd member banks to make agreements under the Banking Code of Practice, enhancing access to affordable banking services and providing relief for farmers during natural disasters. Submissions are due by 18 April 2025, with interim authorisation granted on 4 December 2024 remaining effective until the final decision.