Banks cut savings account fees

A number of major Australian banks have recently chosen to cut the fees on their flagship accounts, a commentator has noted.

John Kavanagh, a finance writer for the Sydney Morning Herald, said that "fee cutting is now well-entrenched in the competitive armoury of retail banks".

For example, he observed that in September last year, National Australia Bank cut out overdrawn fees on all personal transaction and savings accounts.

In addition, NAB chose to reduce its credit card late payment fee from $30 to $5 while also introducing a free opt-in SMS payment reminder service to alerts customers when credit card payments are due.

Mr Kavanagh noted that after NAB was hailed as a "frontrunner" by the consumer group Choice, other major banks chose to follow suit. This included Westpac, which in October cut all its exception fees, including account overdrawn fees and credit card missed-payment fees, to $9.

Such fee reductions should be a further consideration when Australians compare savings accounts and credit cards. Earlier this month, the Australian Associated Press reported that Aussies spent a record $22 billion on credit and charge cards in December last year.

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