Credit cards out of reach for 3 Million Aussies

Nearly 3 million Adult Australians do not have access to a cluster of fundamental financial services, including credit cards, bank accounts & car insurance

Australia's banks need to take a good hard look at themselves

    Got a $3,000 emergency? Save yourself the embarrassment of a decline of a credit card and don't ask your bank! Your family and friends are more likely to respond to your emergency than a bank.

Pay day lenders fill the gap

Payday lenders, who will charge much higher rates will fill the gap. And a little known source for smaller amounts can be Centre-link, if you are a client.
How can you operate without a bank account today? Move to Woollongong or the ACT!

Parts of NSW have the highest number of people without even a basic bank account, let alone a credit card.
But the Wollongong region tops the nation, with 7 per cent of adults without a bank account.
The number of adults in Sydney's southern suburbs and the ACT without a bank account is running at 5 per cent, with the National Australian average of 3 per cent of adults.

And that excludes Aborigines and Torres Strait Islanders. If you add those, then up to 43 per cent operating outside the mainstream banking system.
Why do people have problems getting credit cards or insurance?

Main issues in credit exclusion cited were:

1.     The cost of basic financial services remains too high.
1. The average annual combined cost of banking, credit card and either car or home insurance is $1794. 
2. The level of documentation needed to establish an account can often be a hurdle, 
3. Many banks won't lend less than $5000 as a personal loan, instead steering customers to credit cards.

National Australia Bank says Australia's banks need to lift their game

The National Australia Bank were part funders of this survey, and NAB chief executive Cameron Clyne says the banking industry needed to "lift its game" by providing affordable products to more people.

    "The absence of access to mainstream financial services does preclude people from advancing socially and economically,'' Mr Clyne said yesterday.

When the fridge, telly or car breaks down or someone needs to get to a job interview the banking system needs to improve financial inclusion and community spirit.

Access to credit is improving

While efforts to improve access to basic bank accounts & to promote low-cost credit products are being made, more needs to be done.
The Government has recently chipped in with Federal Treasurer Wayne Swan brokering an agreement with the banking industry to provide free ATM transactions for indigenous people in remote communities. That still leave millions left to help.

Source: Mr Mortgage

Credit Cards: Green Bandt to ban Hole in the Wall cash bandits.

You'll "get more green out of your ATM cash machine" soon if Andrew Bandt gets his private members bill over the line.

Bandt's bill has the attraction factor

Green Andrew is proposing a ban on those $2.00 ATM transaction fees for withdrawing cash.
Politicians from the entire spectrum are liking his tune and are backing Green MP Adam Bandt's private member's bill.
Bob Katter also stuck his boot into the Government and Opposition for skinny policy offerings, though Labor Treasurer Wayne Swan has been holding its cards close to it chest. He is expected to release his plan for banking reform later this month.
Though Independent MPs Andrew Wilkie, Tony Windsor, Rob Oakeshott and Bob Katter and unaligned Nationals MP Tony Crook said Mr Bandt's bill, now before Parliament, was the most promising proposal on banking, they have yet to see the Labor Plan, but I suspect that it will be more wide ranging in terms of offering real competition to the major banks than Andrew bandt's bill. Let's wait and see on that one.

Call to action to stir Wayne Swan

The calls to action increases the pressure on Treasurer Wayne Swan, who will next month announce banking reforms that could need the support of the crossbenchers.
The banks' all claim that politicians did not understand that funding costs were going up. Wilke says that this core claim is nonsense.
Mr Katter said the surge in banking chiefs' salaries also warranted attention and could be curbed through the tax system.
Mortgage Foreclosures unfair.
He called on the government to do ''something serious'' about the system of mortgage foreclosure, which was weighted in lenders' favour.

Summary of Bandt's Bill

As it stands, Andrew Bandt's proposed bill has three main areas of saings for Australian Credit users.

1. A crackdown on Bank Fees.
2. Mortgage Rates to move in line with RBA increases
3. A ban of bank transaction fees of $2.00 per transaction.

Whatever the outcome, it looks like Australia's Parliament is in for a lively time on the floor next year, and home buyers can look forward to more and better loan offers from nonbank players, lower mortgage interest rates and lower fees, no to low exit fees on their mortgages rates, and credit card losing unfair fees. Sounds good to me.

Credit Cards: CabCharge pays $15m in trade abuse case

CabCharge gets off lightly in credit card scam

If you elect to pay by non cash means in a cab in Australia, you goy stung 10%.
Well now the 10 per cent surcharge on taxi fares for non-cash payments could be lifted after CabCharge admitted breaching the Trade Practices Act by abusing its market dominance.

Credit cards business closed to competition by CabCharge unlawful

CabCharge admitted it had taken advantage of its position in the market to refuse requests from competitors to process Cabcharge cards on their electronic payments systems.
The company also admitted to predatory pricing by installing its fare meters free or below cost, squeezing rivals out further.

CabCharge agrees to pay $15 million in fines

It will pay penalties and costs of $15 million after agreeing to a settlement with the Australian Competition and Consumer Commission [ACCC] yesterday in the Federal Court, avoiding a lengthy court battle that was due to begin next month.
The ACCC chairman, Graeme Samuel, said the settlement was a ''clear message to Cabcharge it had gone too far'' and would lead to greater scope for competition in the industry - and lower prices for taxi customers.
''Generally where you can get some competition in the marketplace you tend to find service levels increase and prices reduce for consumers,'' Mr Samuel said.

''You could see potentially service providers saying to cab drivers and cab owners 'We can offer you a better deal than Cabcharge can offer', and Cabcharge will have to meet that competition.''

CabCharge slugs 10% on every credit card transaction

Cabcharge levies a 10 per cent surcharge on every fare processed on its systems paid by credit card, bank debit card or through its proprietary charge card and vouchers.
Its long-standing and popular charge account has helped it become the dominant player in the industry. It has its machines installed in 96 per cent of taxis across the country, though its rivals have increasingly encouraged operators and drivers to install their machines additionally, offering them a cut of the 10 per cent surcharge.

CabCharge forced to agree to Compliance of ACCC

The court ordered Cabcharge to comply with a compliance program involving beefing up its internal controls and training to ensure it did not contravene the act again. It will also be subject to external audits.
Mr Samuel said the penalty would deter CabCharge from repeating its behaviour.
''They now know what constitutes a breach of the act and misuse of market power.''
In a joint submission with the ACCC tendered to the court, Cabcharge said it had been unaware it was breaching the act but now accepted its actions were ''serious in nature and extent''.
The submission said the contravening conduct was undertaken at ''the most senior level of the corporation'', including its prominent executive chairman, Reg Kermode.
Mr Samuel said the settlement had reaped the highest penalty imposed by the commission for the misuse of market power.

Were CabCharge rewarded for bad behaviour?

Based on the amount ripped off from the public, many are saying that CabCharge out out of jail in that the fine was tiny compared to the money made from the scam and this was reflected in CabCharge's share price surging over 10% higher.

You will need to claim losses yourself

The ACCC did not quantify any loss or damage to consumers or competitors, saying it was ''not likely to be readily ascertainable''.
Whilst CabCharge denied its behaviour had contributed to any such loss or damage if you paid the amount you would have suffered.
Any individual, business or Government Department who has suffered a loss or damage, or who wants to get a refund on the 10% surcharge should contact CabCharge now.
Source: Mr Mortgage