The Finance Brokers Association of Australia has welcomed the announcement that ANZ will cut annual interest rates on two of its credit card products by 2 per cent.
FBAA executive director Peter White said the association has been calling for this move for a long time and has lobbied hard behind the scenes.
“We are on record calling on banks to cut credit card interest rates, which were increasing while the banks’ real costs and interest rates were decreasing,” Mr White said.
He noted that with some banks charging in excess of 20 per cent interest on credit cards, there is room for far greater reductions than 2 per cent.
Last October, federal MP Scott Buchholz, a member of the House of Representatives standing committee on economics, questioned ANZ chief executive Shayne Elliott on the subject.
During the review, Mr Buchholz asked the bank boss, “Does ANZ have an appetite to look at reducing credit card rates?”, to which he replied, “We absolutely have an appetite to look at it.”
Mr White said the FBAA regularly meets with senior ministers of the federal government.
Following a meeting with Treasurer Scott Morrison in October last year – during the banking review — he said, “Treasury is talking about better outcomes for credit card holders, and the current review is forcing the banks to acknowledge their failings, yet they are still not being open about issues like interest rate margins, credit card rates, and the bank bill swap rate.”
In August last year the FBAA criticised an oath signed by senior banking executives, dismissing it as a stunt.
“CEOs and senior managers are pocketing enormous bonus payments for reaching billion-dollar profit targets but where is the reduction in credit card rates which are at an all-time high?” Mr White asked at the time.
“This announcement by the ANZ is a move in the right direction, and now let’s hope competition, if not corporate responsibility, forces other banks to follow and bring real reform."
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James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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