Commonwealth Bank boss makes embarrassing admission about outrageous $3 withdrawal fee
Commonwealth Bank boss Matt Comyn says he was unaware of the disastrous decision to charge account holders $3 for cash withdrawals until he read about it in the media.
The bank was forced into a humiliating retreat after the measure was swamped by a groundswell of anger from Australians. with politicians and the media labeling it as the ‘worst Christmas present ever’.
Mr Comyn said he only learned of the decision to switch customers from the ‘Complete Access Account’ to a ‘Smart Access Account’ through media outlets reporting on the PR debacle, which would incur a $3 fee brought for over-the-counter, post office and telephone recordings.
“I was surprised and disappointed to see that change happening,” Comyn told the newspaper Australian Financial Statement in an article published Tuesday.
“I’ve made a few phone calls to try to figure out what’s causing that, I think.”
The decision was made by the Commonwealth’s retail department, led by Angus Sullivan, who reportedly thought the change was ‘harmless’.
However, Mr Comyn said he immediately understood how the decision would be viewed with many Australians facing financial difficulties and his bank posting near-record profits of almost $10 billion last financial year.
“Honestly, the reaction didn’t surprise me,” Comyn said.
Commonwealth Bank boss Matt Comyn said he only learned about the decision to charge account holders $3 to withdraw their money over the counter after it was reported in the media.
Two days after the bank sent an email to one million customers informing them of the change, Mr. Sullivan announced there would be a six-month pause in account switching for customers who are “worse off with the new compensation’.
“We recognize that we have not communicated well about this,” Mr. Sullivan said.
Although the switch would continue for customers better off on the new account, Mr Sullivan admitted the bank had made the switch ‘more difficult than we should have done’.
He said the bank would individually consult about 100,000 customers who were worse off and transfer them to a new type of account that best suited their needs.
Guided withdrawal fees will continue for customers already on the Smart Access account.
Angus Sullivan, head of the Commonwealth Bank Retail Division, thought the $3 withdrawal would be ‘harmless’
These account holders can make free withdrawals from ATMs and the fee is waived for retirees, under-18s and those who deposit $2,000 per month.
Despite pressure from politicians, including Treasurer Jim Chalmers who contacted Mr Comyn directly, the bank has refused to scrap the plan.
The bank has complained that cash trading costs about $400 million a year, which equates to $40 a year for each of the Commonwealth’s 10 million customers.
“Many of our customers do not use cash and these customers are cross-subsidizing those who do,” Mr Comyn said last year.
‘Five years ago, 43 percent of all cash register transactions took place in cash. Today this figure is around 15 percent.
“And yet customers transact more than $18 billion through the CommBank app every week, a 64 percent increase in just two years.”
The Commonwealth continues to make it harder to access cash, closing 73 branches and more than 800 ATMs by 2023.
However, there remains a strong community feeling that banks should deal with cash for those who want or need to do so, as evidenced by the strong backlash against Smart Access withdrawal fees.