NAB Endorses Credit Card Law Reform

Australian banking major, National Australia Bank, once again differentiating itself from its big four rivals over exception fees, says that credit card law reform would benefit consumers.

Lisa Gray, who runs the lenders personal banking division says that NAB has already implemented changes to its credit card portfolio, which are consistent with the federal government’s proposed changes to credit card laws.

Ms. Gray made her comments in response to the announcement made by current Prime Minister Julia Gillard, that a re-elected Labour government would seek to ban lenders from charging customers who exceed their credit card limit.

Under existing regulations, customers who exceed their credit limit can be hit with a $25 fee.

Labour is seeking to change this, so that lenders would be regulated in a way that would prevent them from allowing customers to over draw on their credit card without the prior explicit consent of the customer.

The government also proposes to ban unsolicited offers to extend credit limits. whilst NAB has already has already done away with its over-limit fee on credit cards and cut its late payment fee, Ms Gray said in a statement.

NAB said nothing however about whether it would also end the practice of unsolicited credit limit extensions.

“While further consultation would be needed, some sensible credit card law reforms would benefit consumers and banks offering the fairest and best value,” NAB said.

NAB’s position is at odds with its other big four rivals, with a banking lobby group suggesting that further regulation was unnecessary, since the vast majority of Australians used their credit cards responsibly.

In 2009 NAB distanced itself from its rivals by cutting exception fees, and undercut mortgage interest rates, as it sought to improve its market share, and build goodwill with its customers.

In 2009 NAB sought to differentiate itself from its rivals by cutting exception fees and undercutting interest rates on mortgages to improve its market share.

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