16 April 2000
THERE'S one way to avoid bank fees do your banking on the Internet.
It costs a bank a lot less to run a computer network than it does to run a branch network.
And the banks are passing on at least some of those savings to customers prepared to give it a try. Certainly, you'll beat the queues.
Commonwealth Bank e-commerce general manager Stephen Coulter said the greatest saving was time.
``People who do their banking on the Internet are more concerned about convenience than price," he said.
About 5 per cent of Australian bank customers use online banking. This is expected to grow to between 20pc and 30pc within five years, a level already reached in Finland.
Of course, you must have a computer and pay regular charges for your Internet service provider and telephone connections to get started.
In Australia, National Australia Bank has taken the most aggressive position in the brave new world of Internet banking. The bank says all Internet transactions are fee-free ``for the time being" suggesting things might change.
In the meantime, NAB is going one step further through its alliance with Internet service provider Freeonline. Freeonline gives subscribers unlimited free access to 4,000 FreeZone sites and 75 hours a month of free Internet surfing on all other sites around the world, all for the price of a local phone call though only in Sydney and Melbourne for the moment.
NAB's Brandon Phillips says the number of ``electronic customers" is growing rapidly, with families getting computers at home for the sake of the children's schoolwork, then discovering that everyone can use them.
The ANZ counts Internet transactions as part of your allowance of free withdrawals per month, the number of which varies according to the type of transaction account you select.
If you go over that free quota, the bank generally charges $2.50 for ``staff-assisted" withdrawals in a branch, 65? for ATM and cheque withdrawals, 40? for EFTPOS and phone banking transfers but only 20? for Internet transfers.
Customers can save on both account-servicing fees and withdrawal fees if they have certain ANZ accounts, such as a home loan or residential investment loan, or their combined deposits in ANZ accounts are $20,000 or more.
St George follows a similar strategy. The bank's Everyday Account allows the eight free transactions (including Internet transactions) each month, but after that branch transactions are charged at $2, withdrawals at a St George ATM cost 50? and an Internet transaction costs 20?.
Westpac doesn't differentiate between Internet transactions and other forms of ``self-service" banking, such as ATMs, automated voice telephone banking and EFTPOS.
If you go over your free withdrawals limit on a Classic account, a transaction via any of these channels will cost you 65? but this is is still cheaper than the $2 a ``staff-assisted" transaction, such as an over-the-counter withdrawal, would cost.
The Commonwealth Bank has taken a slightly different tack in its ``clicks and mortar" strategy.
Normally, excess withdrawals on the Commonwealth's NetBank are charged at 40?, the same rate as that applying to EFTPOS, telephone transfers and direct debits. This compares with 60? for excess cheques and $2 for excess transactions in a branch.
But the bank also offers a ``relationship rebate" based on a customer's total balance that is, the sum of deposits and your loans.
If you have $1,000 in a cheque account and a personal loan for $15,000, your total balance is $16,000. For each $500 of this, CBA takes 50? off your monthly fees.
Anyone with a home mortgage has all fees automatically rebated. Stephen Coulter said: ``More than 70pc of all our customers pay no fees, and the proportion is even higher among customers who use NetBank."
BEATING EXCESS FEES
BRANCH ATM EFTPOS INTERNET
AMP free free free free
ANZ $2.50 65c 40c 20c
CBA $2* 40c* 40c* 40c*
COLONIAL $2 50c 50c free
NATIONAL $2 50c 50c free
ST GEORGE $2 50c 50c 20c
WETPAC $2 65c 65c 65c
Note: All fees apply after the free transactions threshold has been reached.
*Rebate applies depending on other business done with bank.
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