The " Bandit Banks " !

 When the second world war ended there was a move by Ben Chifley's Labor government to nationalise the banks  in Australia.  If that had been achieved there would have been just one bank offering its services to the Australian public, and that would have been the Commonwealth bank.

That was a time when more than a dozen very different banks were actively trading in Australian cities, plus state banks representing the various states and territories.  Over the years, acquisitions thinned their ranks, until now we have gravitated to the " big four " mega banks which work in lockstep  There is little difference in the trading policy of those mega banks and their offerings to the public.

Many of the building societies and credit unions that offered a more personal banking service to the big banks have made the move and become banks in their own right, but they lack the size and depth of  credit to move in the field of high finance.  There is not a shadow of doubt that banking is dominated by the power of the " big four ".

Unfortunately, these mega banks are cutting back on the services they offer.  Initially, they replaced branches with ATM's and now ATM numbers are dwindling and the hours that branches open are about to be reduced.  The banks are retreating from face to face communication with their customers and insisting that movement be done online, but they are not updating services to make that easy.

When a term deposit matures, renegotiating its renewal requires an actual signature on a piece of paper.   It can not be renewed by phone or email and a seven day time frame from the date of maturity is required.  If you miss that requirement, the bank automatically renews it for the term length of the previous  arrangement, at an interest rate less than you would be offered if you personally negotiated and signed that paper with your banker.

The mail service no longer guarantees a prompt delivery of letter services and this coronavirus lockdown makes it difficult for many people to physically attend at their bank.  The banks claim a keen interest in providing services to their customers, and then rob them blind with an inferior interest rate by imposing difficult trading requirements.

There are still many older folk who stick with the bank passbook system.  They have their pension paid into their savings account and draw their needs in cash.  Interest rates have crashed and now saving accounts with a balance of a few thousand dollars get no interest payments at all, but the banks use that money to attract profits for themselves.

Usually, it is the same people getting no interest on the money they have in a savings account that are paying high interest on what they owe on one of the credit cards the banks are dispensing so freely.  The banks demand high interest because this is " unsecured credit " and they claim it has a high risk factor. They also seem to be attracting delinquent credit card users by offering a long interest holiday to those who switch to their banking services.

The recent Royal Commission  on banking was very critical of the morals and ethics of the big four banks.  Very little has changed in the thinking that underpins banking, nor will it change until those old building societies and credit unions build the strength to seriously challenge those big four for their customer base.