As supermarkets edge closer and closer to the mortgage market, one has been taken to task by APRA already.
Woolworths has run afoul of the prudential regulator over its use of the word "banking" in marketing its financial services, Fairfax has reported. Fairfax has claimed APRA is probing the supermarket after it labelled its credit card business a banking service.
A Woolworths spokesperson acknowledged that the company was using the wrong word, and said it would be rectified, Fairfax said. But consumer group CHOICE told Fairfax that Woolworths' actions were "careless".
"We have seen supermarkets moving aggressively into financial products and they need to be careful as they do that. It’s a highly regulated environment with a lot of consumer protections that exist for very good reasons. The risks associated with a financial product, particularly a credit product, are very different to those associated with buying food and groceries at a supermarket," CHOICE director of campaigns and communications Matthew Levey told Fairfax.
Both Woolworths and Coles have been making more aggressive moves into financial services, with Coles recently announcing a joint venture with GE
Capital to offer financial products.