What Australia's biggest bank is doing to win back customers
The Commonwealth Bank has copped a few curve balls lately but it's making a big effort to win back customers with innovative products and good deals.
CommBank has had a rough run lately. A $10 million refund to customers sold unsuitable insurance products; a $23 million payout to customers who received poor financial planning advice; a money laundering court case launched by AUSTRAC and a potential class action from shareholders over the ensuing fall in CBA shares.
It's not a good look for Australia's largest bank, but CommBank certainly isn't tossing in the towel. The bank is making a big effort to get customers back on side with a range of sweeteners.
Here's what's on offer.
Free ATM access
In late September 2017, CommBank announced it would scrap cash withdrawal fees across its ATM network, making it free to withdraw cash from any one of CommBank's 3400 ATMs no matter whether you're a CommBank customer or not.
It's a step in the right direction given that Australians collectively wasted an estimated $540.6 million on foreign ATM fees in 2016 alone. Even better, the other big banks were quick to follow CommBank's lead and scrap their ATM withdrawal fees also.
Within days of ditching the cash withdrawal fee, CommBank announced a 24% increase in non-CBA customers using its ATMs.
Future Home Saver Account - pocket up to $3000 bonus interest
CommBank's Future Home Saver Account gives home buyers a chance to earn bonus interest worth up to $3000, however there are strings attached and it's definitely not a cash giveaway.
The Future Home Saver Account is an online savings account, which must be linked to a CommBank transaction account. The account earns standard interest of 1.0% but savers can also accumulate bonus interest of 2.0%, redeemed when they take out a CommBank home loan.
The bonus interest is non-compounding so you won't earn interest on bonus interest while it's accumulating, and the maximum bonus is $3000.
Is it a good deal? On one hand many first home buyers will appreciate any sort of financial helping hand. However, the ability to earn bonus interest does tie you to taking out a CommBank home loan, and a quick look through comparison sites shows plenty of low cost home loans are available through other lenders.
If you're looking for a high rate on savings without locking in to a particular lender, it's worth taking a look at the likes of the Maxi Saver account available through BankSA and St George (2.8%) and ME Bank's Online Savings Account (2.95%). Both impose conditions to earn the top rate so be sure to read the fine print.
Great Rate credit card purchases
CommBank credit cardholders can apply to pay an ultra-low "Great Rate" of 0.99% on a nominated card purchase up to $1000. The Great Rate applies for three statement periods after which any balance remaining on the purchase attracts the regular card rate. Only one Great Rate purchase can be active at a time.
It's worth pointing out that neither Great Rate purchases nor Future Home Saver Accounts are new offerings from CommBank. Both have been around for a number of years.
However, if you're a CommBank customer and you're receiving reminders of these deals via say, SMS, it could be CommBank's way of letting you know there are still some innovative options in its suite of products and services.
That said, your own financial wellbeing should take priority over loyalty to any particular financial institution so be sure to check whether the CommBank products you use offer genuine value or if you could do better elsewhere.