Australians paid 10% more in bank fees last year, Reserve Bank says
Australians paid 10% more in bank fees last year, Reserve Bank says
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Rise was partly due to more households using their credit and debit cards overseas as travel bounces back, analyst from central bank says. Australian households paid almost 10% more in bank fees in the 2023/24 financial year, with credit card and personal loan use soaring amid the rising cost of living.
That contributed to banks enjoying a 5% jump in fee revenue in 2023/24 – the first annual increase in fee earnings in seven years, the Reserve Bank said in its January bulletin. Australians paid 11% more in credit card fees, mainly reflecting a rise in card-holders spending money overseas as international travel rebounded, said RBA analyst Robert Gao, who authored the report.
Sign up for Guardian Australia’s breaking news email. “With more households using their Australian credit and debit cards at overseas businesses, banks earned more fees on international transactions and foreign currency conversions,” he said. Meanwhile, personal loan fees shot up 34%, reflecting growth in establishment and transaction charges as more Australians took out credit to cover cost-of-living challenges.
The increase in fee revenue came as Australian households saw their real disposable income fall below 2017 levels, battered by high interest rates and inflation. Many mortgage holders experienced sharp rises in repayments as fixed-rate loans matured and consequently sought to renegotiate a new loan with their existing lender or refinance with another provider.
