6 August 2020
The consumer benefits of the mutual banking model are so clear that they mount a compelling case for greater Federal Government action to educate people about the sector, Heritage Bank CEO Peter Lock said today.
Mr Lock said it was disappointing that many banking consumers in Australia did not fully understand the difference between the listed bank model and the mutual model.
He said if the Government was serious about addressing the failings of the big banks that the Hayne Royal Commission uncovered, a simple solution was to do more to educate people about how the mutual sector was different.
“There is undeniable evidence that banking with the customer-owned sector delivers many benefits for consumers. More Australians need to know why, ” Mr Lock said.
That evidence includes the following:
Mr Lock said while the benefits were clear, many people simply did not fully understand the difference between the ASX-listed banking model and the customer-owned banking model.
In fact, Heritage commissioned research in 2018 that showed around 59% of people surveyed were not sure what a customer-owned bank was.
“When people understand how the customer-owned model works, they also understand why it delivers so many benefits.
“However there is confusion out there about how customer-owned banks are different. Everyone in this sector is doing their bit to educate people about how our model is different, but we are up against the deeper marketing pockets of the big banks.
“A simple way to promote greater competition in the banking sector is for the Federal Government to do more to educate people about how the customer-owned model works and why it is different to the listed bank model.”
Mr Lock said a good start would be a marketing and advertising campaign supported by the government.
“It’s simply about helping understand the different banking models in operation in Australia.
“That awareness is the critical first step in creating a more informed choice for Australia’s banking consumers.”