ME Bank (Members Equity Bank Limited) - Changes to the redraw facility without advising affected customers
Hi & welcome to the Forum.
In the article you refer to, ME have explained why they did itl apologised for not communicating better with customers; committed to helping people impacted by the reduction in the redraw; offered to rearrange financing at no cost; and offered a payment holiday to those in need.
They have also indicated that they are not going to resile from their change.
Seems like the crux of your post is the lack of notice. Is this correct or do you have some other issue?
Yes, lack of consultation and notice relating to changing the terms and conditions of a contract.
As an affected customer I only became aware of this via the media today which alleged the changes occurred Monday 27/04/2020.
As I have received no correspondence from ME Bank in relation to these changes, I cannot advise when they occurred, but do note ME bank released a general media statement 02/05/2020.
ME Bank Media Statement 02/05/2020
Maybe the ‘Consultation Policy’ is to ask for forgiveness rather than permission…
Thie article regarding ME Bank’s behaviour is far from flattering.
ME Bank’s high handed behaviour could almost make the big 4 banks look good.
Yes it is surprising that EM took this approach as they do seem to give an impression they are different to the big banks and their members/customers come first.
Consultation could have been quick (a few days) and provide some notification (let customers know of the change in advance)…rather than dumping the change on its customers and customers finding out change through other sources.
One would have expected better of ME Bank.
ARPA has now issued a "please explain’ notice to ME Bank.
It is going from bad to worse very rapidly.
Latest update on ME Bank…
Better late than never.
A lot of people had probably never heard of ME Bank before this fiasco but will know their name know for all the wrong reasons.
We had a BRC which this government has been dragged to respond and implement changes required and now helping the banks hide behind Covid19 and then ME behaving like this clearly the banks only concern are profits and shareholders the big 4 still have credit card rates at 20% while interest rates are at 1-2% gouging comes to mind aka standard banking behaviour
Possibly the concern at this moment in time is financial viability of the banking system. All the banks I have seen in the recent reporting season have either not paid a dividend (such as Westpac) or reduced dividend payout to shareholders (such as Macquarie) as they are expecting a very high level of loan default on their books…far more than anyone envisaged 6 months ago and due to the rapid increase in unemployment and ability of Australian to repay their debt.
Withholding shareholder dividends has been recommended by APRA to allow banks to weather the COVID-19 storm. Australia and its economy is heavily reliant on a healthy banking system, and the current pandemic was unexpected, unplanned for and has the potential to affect the whole of the banking system if not managed appropriately.
I can see why the government is deferring (and not cancelling) BRC actions as they impose additional cost on the banks when such costs may affect the stability of the sector. If the government decided not to implement the recommendations, this then this would be a real concern. Currently this is not their plan.
Also, having credit cards at 20% in someways has merit as it is a disincentive to use the cards to obtain credit…or encourage those with existing debts to pay this off first as it is higher risk to the lender. It may encourage some to live within their means. While it is not palatable to many, there may be reasons why such is still high.
It also appears ME Bank thought the rules had been relaxed by the regulator because of the pandemic and they could do what they liked…they learnt very quickly this is not the case and they have been hit with a bank sledge hammer instead.
I agree that such are near the bottom of the heap (just above payday loans) but I doubt that the vendors are actually setting rates higher to encourage their customers to pay their loan off early. This kind of lender really wants you to be on the hook perenially - as long as you keep paying.
You’re welcome to your opinion. APRA as noted stepped up to ME Bank which is what was needed. Consumers have certainly been quick to respond in their condemnation.
Rationally there are many demands on the banks at present. The deferral - extension of the time line for completing the actions recommended by the BRC does have support, including that of the consumer organisation Choice.
Can a bank exist without customers?
Even the RBS has customers.
The issue of the gap between general interest and credit card interest rates is not just a recent concern. Part of that discussion needs to include the CC global provider relationship. VISA, MasterCard, AMEX, etc. You’re not alone in asking how or why. There are several Choice Community topics which encourage that discussion.
So even after the Banking RC, nothing has changed including the incompetence and stupidity of the so-called regulators.