Commonwealth Bank backlash after advising customers how to ‘look good on a budget’
The Commonwealth Bank has caused a stir with a video advising customers how to keep up appearances ‘on a budget’ – while interest rate rises are passed on to Australian mortgage holders.
Personal finance expert Jessica Irvine suggested four ways clients can “look good on a budget” in a smiling video shared on the bank’s Instagram account Thursday.
“Keeping up appearances can be pricey, but there are ways to pay less for your looks without giving up critical self-care,” Ms. Irvine began the video.
The former Sydney Morning Herald and The Age economics writer outlined ways for clients to ‘cut costs’, including buying second-hand clothing, shopping for products, finding hair and beauty training and renting outfits.
In a video shared on the bank’s Instagram account, financial expert Jessica Irvine (pictured) gave four ways customers can “look good on a budget,” including buying second-hand clothes, browsing products, Find TAFE training days and rent outfits
“Embrace buying second-hand clothes at your local charity shop or retail store. Also try to travel to shops in upscale suburbs for high quality items that are often a fraction of the price,’ said Ms Irvine.
‘See if there are cheaper versions of your favorite products. There may be a dupe that is just as good but will cost you much less.
“For a little professional pampering at a discount, try local salons and TAFEs in your area for training days, and finally, try renting outfits for one-off events rather than buying them new.”
Outraged Commonwealth Bank customers reacted to the video, claiming that the country’s largest bank could cut household budgets by lowering interest rates on mortgage payments.
“Wow, what a bust,” one person commented.
“Telling people to cut spending while the banks are making record profits. Stuff you,” another person wrote.
“No, this is terrible — lower your interest rates,” said a third.
“Or just freeze interest rates so people don’t suffer as much from the financial crisis,” a fourth person added.
Outraged Commbank customers labeled the video a ‘failure’ and called out the bank for advising people to cut costs after posting profits of more than $5.2 billion
The bank faced more backlash in another video that asked customers to describe the side issues they had at school.
Commbank captioned the post: “Ps what’s a cup of homemade lemonade these days?”
One customer replied, “With all the rate hikes who can afford it?”
A second customer ignored the question, insisting that the bank would not be satisfied until they were homeless.
When will you stop raising mortgages? I’ve had to find a second job, did a 5-hour workday yesterday, and six hours later I’m up to do it again.
“Looks like you won’t be happy until I’m homeless,” the customer wrote.
Commbank decided to raise interest rates on some of its savings products and home loans The Reserve Bank of Australia’s decision to raise its official cash rate by 0.25 percentage point on June 6.
The Reserve Bank of Australia this month raised interest rates to an 11-year high of 4.1 percent, its 12th since May 2022.
On Friday, Commonwealth Bank’s existing floating rate borrowers saw their mortgage rates rise 0.25 percentage point, in line with the RBA’s 25 basis point increase.
But new customers are thrilled with some rates rising 0.4 percentage points — 0.15 percentage points more than the Reserve Bank’s June hike.
It is the fourth time since March that CBA has increased the rates for new customers on its Extra Home Loan.
RateCity research director Sally Tindall said new customers get the “raw end of the deal” when they sign up with CBA.
“CBA is now officially fleeing the scene when it comes to the battle for new customers,” she said.
“This is the fourth time the bank has raised the rate on its variable base loan in the past four months, in addition to the three standard RBA increases we’ve had in this time.”
As of June 16, borrowers with a CBA variable mortgage saw their interest rates rise by 0.25 percentage points, with a select few new customers taking a beating
Increases in CBA’s Additional Home Loan for new customers who own and pay principal and interest
CBA’s lowest variable base rate rose a whopping 1.12 percentage points from existing customer rates that rose 0.75.
“It’s not often that new customers get the raw end of the deal,” Ms Tindal said.
While these additional rate hikes won’t affect existing customers, anyone considering a basic mortgage with Australia’s largest bank may now change their mind.
“Prospective buyers should know that they can and should get more competitive rates, especially if they are struggling to get the go-ahead for a home loan application.”
In February, CommBank revealed that its statutory net profit had increased due to the rapid rise in interest rates when comparing the first fiscal halves of 2023 and 2022.
The bank reported a half-year cash profit of $5.216 billion — up 9 percent — after interest rate hikes boosted its profit margins as thousands threaten to lose their homes.
Daily Mail Australia contacted CommBank for comment.