This week in banking - the future of Velocity points and 5 other things you don’t want to miss!
- Virgin Australia’s Velocity frequent flyer program: what will happen to your points?
- Small business 30-day payments called to be legislated
- Property prices to spiral: what it means for the Aussie market
- These credit card providers have cut rates amid COVID-19
- Qudos Bank bumps up term deposit rates
- One third of Aussie savers looking to plump up their emergency fund
All in this week’s banking recap.
Will your Velocity points go down with Virgin Australia’s sinking ship?
The news has been flooded this week about Virgin Australia going into voluntary administration, leaving many Velocity customers thinking: what’ll happen to my points?
In an ASX statement on Tuesday, Virgin Australia said, “Velocity Frequent Flyer, while owned by the Group, is a separate company and is not in administration,” meaning that points are safe, for the moment.
However, at the moment the online Velocity store is unavailable to customers and points redemptions have been put on pause for at least the next four weeks.
There has also been no official word from Virgin Australia on what exactly is going to happen with the future of the program in the long term.
Read full article: Virgin Australia on verge of collapse: What it means for your Velocity points to find out what experts are speculating will happen to the airline’s frequent flyer program.
30-day payments to small businesses from large companies called to be legislated
COVID-19 has hit small businesses hard, but the unfortunate truth is that some larger companies are taking advantage of the current financial climate.
According to the final report of the Australian Small Business and Family Enterprises (ASBFEO) Supply Chain Finance Review, there has been a surge in big businesses using the pandemic as an excuse for delayed or cancelled payments to small businesses that rely on them.
On Monday, ASBFEO Ombudsman, Kate Carnell, called for federal legislation to be passed which would require small businesses to be paid in 30 days.
At the moment, only signatories of the Australian Supplier Payment Code are required to meet the 30-day payment deadline.
Read full article: Small business 30-day payments to be legislated after surge in delays and read what else Kate Carnell said about the latest Review.
What tumbling house prices could mean for the property market
With the halt in commercial activity, and job loss sweeping across the country due to COVID-19, the recovering health of the Aussie property market has taken a hit.
Not only have lenders introduced harsher borrowing restrictions, but social distancing and general financial uncertainty have also played a part in stunting the housing market’s restoration.
This month, Westpac’s Consumer Sentiment report revealed that confidence in the property market nosedived by 50.8% (the largest drop in 11 years).
Aussies are also concerned that now may not be the right time to jump into the property market, with 26.6% less respondents stating that now is the ‘time to buy a dwelling.”
Read full article: Housing prices to tumble: Can we expect any turnover in the property market? and check out what RiskWise Property Research CEO, Doron Peleg said about the current property climate.
Credit card rates get slashed during Coronavirus pandemic
This month, five providers in the Mozo database cut credit card rates by at least 25 basis points after the outbreak of coronavirus and emergency RBA cut in March.
These providers include Auswide Bank, Bank First, Heritage Bank, Queensland Country Bank and notably NAB, which cut its rate by a whopping 1.00%.
However, while only five banks slashed rates, a big handful of other banks and credit unions are offering credit card relief packages to customers in response to COVID-19.
Some of these initiatives include lowering monthly repayments and interest rates, repayment pauses or refunding late fees.
Read full article: Coronavirus credit card cuts: Which banks have slashed rates? and see which banks are offering credit card relief packages.
Qudos Bank eases economics pressure by upping term deposit rates
On Tuesday, Qudos Bank made a second increase to its three to twelve month term deposit rates.
The bank most recently upped its rates from 1.80% to 1.90% for balances of $5,000 or over on its three, six, nine and twelve month terms.
Qudos Bank are part of a crowd of 47 banks and credit unions in the Mozo database that have responded to the economic destruction caused by COVID-19 and increased term deposit rates since the emergency RBA rate cut in March.
Read full article: Qudos Bank ups term deposit rates, eases economic pressure to find out how much interest you could make in one year with a Qudos Bank term deposit.
Aussies looking to save more for their emergency fund as they self-isolate
As we continue to stay at home and self-isolate, many Aussies are tightening their belts and looking to plump up their savings.
In fact, according to the most recent report done by tech company Toluna and digital research consultants Harris Interactive, around 32% of Australians want to contribute more to their emergency fund once COVID-19 passes.
And in another report, ME’s COVID-19 Financial Sentiment Snapshot, the bank found that 35% of respondents are actually saving more during the crisis compared to before the outbreak.
Read full article: One-third of Australians plan to up their emergency savings and familiarise yourself with ways to kick financial goals post-coronavirus.
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