NAB to slash penalty fees
Wednesday July 29, 2009
The National Australia Bank is set to dump penalty fees charged on overdrawn savings accounts.
News Limited papers said NAB chief executive Cameron Clyne will announce the move in a bid to win new customers and improve the bank's image.
The controversial fees will disappear from personal transaction and savings accounts, including cheque accounts, from October 1, the report said.
The gesture will cost the bank $100 million a year, with no new fees planned to offset those lost by axing penalty fees.
A bank memo seen by News Limited said the bank's image had been tarnished by penalty fees.
'These fees generate the most customer complaints of any bank fee and result in more customer complaints to us than any other matter,' personal banking executive Lisa Gray told senior managers in the memo.
'We hear stories every day about a customer's pay going in a day late, gym fees or an insurance premium coming out early - the overdrawn amount is paid or not - but either way an overdrawn account fee is generated.
'Most of our customers who experience these fees just don't think it is fair.'
The move is expected to put pressure on other banks to follow suit.
If a bank account becomes overdrawn, the bank may or may not process the transaction, depending on the customer, and interest will be charged on overdrawn amounts.
