The Customer Owned Banking Association (COBA) has welcomed the federal government’s response to the Financial System Inquiry (FSI), labelling it “great news for consumers”.
COBA chief executive Mark Degotardi said the government is to be congratulated for accepting the overwhelming majority of the inquiry’s recommendations.
“These measures will unleash genuine, sustainable competition in retail banking,” he said.
“COBA welcomes the government’s commitment to regularly review competition in the financial system and to increase the accountability of regulators.
“We also welcome a suite of specific pro-consumer commitments, including a crackdown on credit card surcharging, a requirement on financial advisers and mortgage brokers to disclose their relationships with major banks, and a new product intervention power for ASIC to ban harmful products.”
Mr Degotardi said that with the implementation of the FSI blueprint, the customer-owned banking sector has the opportunity to grow and thrive in a framework that promotes competition and consumer choice.
The FSI report released last year concluded that Australia has a financial system where unfair consumer outcomes remain prevalent and policy settings do not focus on the benefits of competition and innovation.
The report also warned that the high concentration and increasing vertical integration in some parts of the system could limit the benefits of competition in future.