ATM fees may soon become a thing of the past as customers flock to Australia's only bank offering a "zero fee" to access every cash machine in the country.
NAB, Commonwealth Bank and Westpac have come out and said that they would monitor Bankwest's "zero fee" account and decide how best to respond.
Lisa Gray NAB's retail banking boss has said that it will be interesting to see how customers react to that. She further stated that the NAB would look at their products and see if they needed to be modified.
Since new rules governing ATM fees, which were introduced earlier this month allowing banks to charge $2 for using a rival bank's ATM the 'zero fee', account of Bankwest, which was launched last year is suddenly very appealing. Although other bank customers will be hit with a fee averaging $2 when they use a rival bank's ATM, Bankwest will refund the fee to its customers. A spokesman for Bankwest has said that you need to press a button to accept the charge from the ATM owner when asked on the screen, but Bankwest customers wont have to pay it the bank will cover whatever costs the customer may incur.
An executive from a rival bank described Bankwest's account as too good to be true until he saw the customer's list of terms and conditions. Christopher Zinn, of the consumer group Choice thought it was a terrific deal for consumers. Mr. Zinn further added that as Bankwest had a tiny branch network, it needed to do something to attract customers. He also stated that if you didn't require a branch network and used ATMs quite regularly, you could save $100 a year or more.
Bankwest was delighted with the way, the account was running but stated it would have to monitor costs closely. Paul Vivian Bankwest's head of retail deposits stated that if some rogue ATM operators were to charge $10 or $20 for a transaction that could cause them problems.
The Federal Government is concerned about bank charges. Canberra welcomes competition, as it will help to keep bank charges down. Prime Minister Kevin Rudd and Treasurer Wayne Swan met with the banks earlier this month to discuss bank charges. As the banks have hinted that they don't intend to pass on any future interest rate cuts in full, there is likely to be significant pressure from the government to cut fees.
Cameron Clyne NAB boss stated last week that he wanted to address the bank's charges, and that he wanted the NAB to lift their game.