CommBank offers further coronavirus relief to home loan and credit card customers

By Katherine O'Chee ·

As the coronavirus outbreak leaves many Australian households in a tight financial spot, Commonwealth Bank has stepped in to provide another round of support to its home loan and credit card customers. 

The big bank announced that in addition to allowing all of its home loan customers to hit pause on their repayments for six months, it will help offset any interest on interest costs accumulated over the deferral period. 

“When a home loan repayment is deferred for six months, interest is calculated and added to the loan balance each month which can result in customers paying interest on interest each month,” CommBank’s Group Executive of Retailing Banking Services, Angus Sullivan said in a statement released today. 

“To support more Australians, we will make a one-time payment to all customers who are receiving a home loan deferral because of coronavirus.”

According to CBA estimates, this means for an average $350,000 home loan, about $45 would be refunded, although the exact figure will depend on the loan amount and interest rate. 

Meanwhile, credit card customers can also expect some relief from CommBank, if they failed to meet their minimum repayment on time last month due to COVID-19.

CommBank said it will automatically refund their late fees and interest for March. 

“This support is focused on customers who are finding it difficult to meet their current commitments before further Government stimulus arrives in April and May,” Sullivan said. 

RELATED ARTICLE: What does the government’s latest coronavirus stimulus package mean for you?

What other support is CommBank offering to households? 

Today’s announcement builds on earlier measures introduced by CommBank after the emergency Reserve Bank rate cut last month.

This includes reducing repayments to the minimum for all existing variable home loan customers on principal and interest, effective from May 1. 

CommBank has also raised its 12 month term deposits by 60 basis points to 1.70%, available on balances from $5,000 up to $2 million. 

“It will ensure all Australians are now able to earn a return on their savings which is more than 1.45% higher than the official cash rate,” CommBank Chief Executive Officer, Matt Comyn said in a statement following the latest RBA cut. 

As for customers looking to fix their home loan, CommBank announced it will slash a massive 70 basis points from its 1, 2, 3 year fixed home loans, bringing the rate down to 2.29%, effective May 1. 

RELATED ARTICLE: Big bank emergency support: How have CommBank, NAB, Westpac and ANZ responded to the latest RBA cut? 

To see how other lenders are helping their customers, check out our guide on Australian banks’ emergency coronavirus relief packages

Or if you’re interested in locking your home loan rate, we’ve got some offers for you down below, plus even more options over at our fixed home loans comparison table.

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Katherine O'Chee
Katherine O'Chee
Money writer

Katherine O’Chee is Mozo’s international money transfer and forex expert and business banking writer. She keeps Mozo’s readers on top of the latest news and writes in-depth features to inform and help Australians make smarter financial decisions. Her work has been published in major media outlets including Sydney Morning Herald, SBS News and Bangkok Post. She has a Bachelor of Arts (Media and Communications) from the University of Sydney.