Banks 'ripping off customers'

Banks 'ripping off customers'

Australian Banks, by increasing their margins — the difference between the cost of funds to banks and how much they lend them for — over the past year, have cost customers an estimated $790 million.

Australian margins are double those of comparable economies and the highest in the Western world, claims Australian Democrats leader Cheryl Kernot.

Any benefit derived by home buyers, small farmers and small business from lower interest rates has been reduced by increased charges from the banks. Kernot claims the margins are 4-5% on housing and up to 10% to small business.

"We are constantly told 'competition' is the answer. Why then, since deregulation, have bank margins stayed so high? Why are they the highest in the Western world?", she asked the federal government.

From GLW issue 124