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ISCOVER
Jessica Darnbrough
The Federal Government’s tick and flick approach to loan switching has been applauded by one industry body.
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Yesterday, the government announced it would reform the process associated with account switching from July, helping Australians to leave their financial institution with ease.
The reforms come off the back of Roy Morgan research which found almost 50 per cent of borrowers would consider switching to another lender if the red tape was removed.
The Roy Morgan research found one in five Australians are likely to change financial institutions in the next year, rising to almost 50 per cent of people if the paperwork and administrative effort was substantially reduced.
“Abacus welcomes this important consumer research from Roy Morgan which illustrates the opportunities and challenges facing our industry in the coming months,” Abacus chief executive Louise Petschler said.
“The report shows Australians are itching to ditch and switch to banking providers that offer competitive interest rates, fairer fees and charges and the convenience of branches and ATM networks.
“We offer this in spades and our members look forward to Australians switching to us in 2012, particularly when significant account switching reform begins on July 1.”
From July 1, instead of requesting a list of regular debits and credits from their 'old' bank, Australians can let their 'new' bank do the work for them by signing authorisation forms to allow the establishment of regular debits and credits to the new transaction account.
“Clearly the research has found that the administrative hassle of switching accounts is an impediment to our strong desire for new customers, but this won’t be the case for much longer,” Ms Petschler said.
“Switching is easier than you think, and we recognise the next 12 months will be an exciting time for Australian consumers and our industry.”
