Google Scares Aussie Banks 150
mask.of.sanity writes "Google could be the biggest threat to Australia's big four banks because of the trust online users place in it and its ability to engage with customers, banking executives say. They told an audience from the finance sector that companies like Google and PayPal are more responsive and trusted than banks, and cited emerging technology with an emphasis on online applications as a means for the smaller credit unions to challenge the position of incumbent banks. It's welcome news for Australia's credit unions: the nation's banks have taken turns in being the first to lift interest rates above the official reserve bank rate, with others collectively following suit, leading some to speculate they are in collusion."
Re:"Responsive and trusted" (Score:5, Informative)
Yeah, I'm about ready to jump ship at the moment. I applied for a credit card with ANZ a week and a half ago. They tried to call me the next day and I missed it. Since then I try to call back every day or two, to find out what they wanted, but every time I get put on hold and I'm afraid my patience runs out after 15 minutes of that. I've been to the local branch too, but all they can do is phone the credit card folks and wait on hold with me.
I don't actually need your credit card enough for me to put up with that nonsense, thanks.
Re:Not supprising (Score:2, Informative)
Because the big four banks are already so large, it’s impossible for them collectively to grow at a faster rate than the overall economy. For one bank to enjoy higher growth means that they have to market share off the other three, and the big banks appear deeply reluctant to do this.
It’s clear from recent comments made by the banks that they’re dissatisfied with the rate at which their lending is growing. And this is backed by recent statistics from the Reserve Bank which show that while total bank lending for housing is relatively strong, (rising by 0.6 per cent in August to reach a level that’s 8.1 per cent higher than a year earlier), total business lending actually fell by 0.4 per cent in the month (and was down 4 per cent from a year earlier).
Faced with weak lending growth, the big banks will only be able to continue to report increases in their profits year after year if they are able to maintain – and, preferably build – their interest margins.
But this means that the banks are inevitably on a collision course with the rest of the community.
http://www.businessspectator.com.au/bs.nsf/Article/CBAs-bold-move-may-backfire-pd20101103-ATSKH?OpenDocument [businessspectator.com.au]
Re:Not supprising (Score:3, Informative)
The fact that Aussie banks are extremely profitable is a good thing. It means the person running it knows something about business. That profit is a handy buffer if/when default rates go up, and it also means that your super is kicking along nicely (because almost certainly you have some in banks, probably 25% or so).
And the financing costs aren't imagined, they are real. The actual increase as been about 1.7 percent or so, and they've reclaimed about 1.4 percent through going above and out of sync with the RBA cycle. They aren't bad companies, they are just rubbish at communicating to anyone but each other.
Re:What? (Score:4, Informative)
"PayPal is a transaction broker. "
Paypal is a bank.
"As of July 2007, across Europe, PayPal also operates as a Luxembourg-based bank."
https://secure.wikimedia.org/wikipedia/en/wiki/Paypal [wikimedia.org]
Re:What? (Score:5, Informative)
"In the United States, PayPal is licensed as a money transmitter on a state-by-state basis. PayPal is not classified as a bank in the United States, though the company is subject to some of the rules and regulations governing the financial industry including Regulation E consumer protections and the USA PATRIOT Act."
https://secure.wikimedia.org/wikipedia/en/wiki/Paypal [wikimedia.org]
Re:Australias net banking is actually damn good (Score:3, Informative)
American here.
Most banks offer at least 3 months - 1 year of your account(s) history through their online database. This is for a free checking account from my experience. Beyond that you can only get the document in paper and you have to pay for it.
To put it into perspective - the Commonwealth Bank of Australia offer 7 years of statements online for free - even on fee-free accounts. They also allow you to search for previous transactions freely. They probably charge to print out a copy and send it to you, but with online statements going back that far and the ability to export to PDF and CSV - most people easily avoid the fee.
Re:Physical access (Score:4, Informative)
I don't know about Aussie banks but in the UK, "walking into a branch" to address issues is about as effective as "walking into a tree". You almost invariably find yourself face-to-face with a mindless drone who can do no more than what computer says.
Definitely not with the commonwealth bank here in .au. The people who work there know their jobs are hanging by a thread and go out of their way to be helpful. One branch I go to has a triage person near the front door who gets the gist of your requirements then forwards you to second level people. The last person I dealt with finished the exchange by asking me to rate their performance. It looked like a standard part of the process. I have never known a bank employee to be less than completely helpful. They are about 1000 times better than the web site.
I trust Google... (Score:3, Informative)
more than banks hands down. My family are invested in a regional bank and I just got an e-mail stating that they are ending my free checking and that if I don't deposit more money they will charge me $5 a month.
Google may not be perfect and they screw up sometimes but they are the kind of screw ups you glance at shame on you and move on. I mean sure they were taking public wifi data but cmon' it was public data and it was just random packets so that they do location services. Heck, I have an incredibly hard time finding unsecured networks as almost all routers nudge users to security a lot more then they used to. My friend's aptartment has no internet and there are 15 wifi networks and all of them are secure.
Anyways, how can credit unions be shamed for "collusion", they aren't even a for-profit company. Credit unions are the closest thing the banking sector has to a charity so saying they are colluding is like saying the United Way, Red Cross, and Goodwill are colluding for holding joint event.
Re:"Responsive and trusted" (Score:5, Informative)
Re:"Responsive and trusted" (Score:3, Informative)
Re:Australias net banking is actually damn good (Score:5, Informative)
Australian and American dual citizen here with multiple bank accounts in both countries.
You are right. The banking SYSTEMS in Australia are light years ahead of those in the US:
- In Australia you can send money via online banking, for free, to any other Australian bank account (direct deposit). All you need to know is the account number. It's how I paid my rent and some bills for many years. It's not instant but typically the delay is only 1 day for an account at the same bank and 2-3 days for any other bank.
- In Australia you can pay virtually any bill with Bpay. There's no real equivalent in the US. Sure there are a couple of similar systems I've come across ... but they are each completely unrelated to the other, have no interoperability, and virtually noone uses them. You end up having to sign up to several of these systems just to pay a single bill. What makes Bpay work in Australia is the fact that it's THE bill payment system, and EVERYONE uses it.
- EFTPOS in Australia (i.e. payment via debit card + PIN): much more widely accepted in Australia than the US. Even someone sitting in a temporary stall on a street corner accepts EFTPOS in Australia, whereas in the US it's really only medium to large stores, in my experience. And many won't let you do 'cash out' (i.e. pay for a $50 item with a $100 debit, and get the remaining $50 in cash, avoiding a trip to an ATM).
- Due to the above, cheques/checks have gone the way of the dodo in Australia many years ago. I had never SEEN a check in my life before I started living in the US. My parents got rid of their checkbook in the 80s. But in the US they are still very common, and in some areas, almost ubiquitous (I see people using them at supermarket checkouts for God's sake!). It's ridiculously antiquated but Americans seem to love them.
BUT ... Aussie banks do make ridiculous profits and the focus of this article is more that they have higher fees than in most countries, and tend to nickel and dime you any chance they get. Which is very true. The big four banks certainly could use some more competition. But it's not like they have none - there are plenty of smaller banks and credit unions that are competitive in Australia. But the downside of that of course is that their ATM network is far smaller. I think that's why most people stay with the big four in Australia - free ATMs everywhere you go. Whereas if you sign up with, say, Bankwest or Bendigo or something, you really have to plan ahead when you want to take cash out. Case in point: I am in Canberra quite a bit and I have a Bankwest account. The nearest Bankwest ATM is in Wollongong (lol). Sure I can use Commonwealth ATMs for free for cash withdrawal, but for anything else (e.g. changing my PIN, deposits etc) I have to travel a looonnng way ;)
Oh and PS, as an Australian, I will NEVER trust PAYPAL with any significant amount of money. They have twice frozen my account for no reason other than the fact that I had logins from different countries within a day or two of each other (did you know that there are these things called PLANES?). Once I can understand. But it took a week to get it unfrozen and I even told them explicitly on the phone that I was a dual citizen and flipped between the US and Australia all the time. And they STILL locked my account for the same reason less than a month later! Argh. PAYPAL are scum.