The Australian Securities and Investments Commission (ASIC) made the decision after the regulatory body's latest bank-fee review, which found that recipients of Centrelink payments were charged excessive bank fees on transaction accounts.
The regulator's July 2024 report uncovered widespread failings in fee practices at Commonwealth Bank (CBA), Westpac, Bendigo Bank and ANZ, following an investigation into their charges. ASIC then ordered payments totalling more than $33 million to be paid to more than 150,000 low-income First Nations, or Aboriginal, customers.
In the latest report, ASIC reviewed more banks – 21 in total – and found the issue is "a much wider problem affecting customers nationwide," said ASIC commissioner Alan Kirland. In fact, excessive bank fees impact approximately 920,000 customers across Australia.
As a result, the regulator ordered another $60 million needed to be refunded nationwide to more than 770,000 customers – bringing the total to $93 million in overpayments.
ASIC chair Joe Longo expressed voiced concern over the findings.
"Despite the improvements banks have made during our surveillance, there is clearly work to be done," Longo said. "It should not take an ASIC review to force $93 million in refunds or make banks assess their processes to ensure the trust and expectations placed in them are justified.
"Banks need to truly hear the messages in this report – read it, review it and ask themselves some difficult questions about what led to this situation," he said.
ASIC’s review comes amid growing financial strain on Australians, driven by rising living costs, persistent inflation, interest rate uncertainty and global instability. In the property market, surging prices have left an increasing number of Australians locked out of home ownership.
The regulator's review led to refunds ranging from $1,200, to as much as $5,200.
"It's important to understand what those amounts mean for people struggling to make ends meet," Kirkland said. "A $1,200 refund was equivalent to one customer’s fortnightly Age Pension. A $2,600 refund equaled around 110 hours of minimum-wage earnings for another customer, and a $5,200 refund matched 13 weeks of another customer’s JobSeeker payment.
"Our intervention has forced many banks to take action," Kirkland continued. "But more needs to be done to ensure financially vulnerable consumers are not put in this position again."
As part of the latest review, ASIC has also encouraged banks to consider introducing or improving First Nations service channels.
