Mozo’s Kirsty Lamont says switching banks has become much easier lately.
Mozo’s Kirsty Lamont says switching banks has become much easier lately.

Disloyalty can save you thousands

HALF of Australians do all their banking with just one financial institution, potentially costing themselves big bucks every year.

Misguided loyalty, fear of the unknown and convenience are keeping almost 80 per cent wedded to the Big Four banks, new research by comparison website Mozo.com.au has found, and suggests it's costing average customers $1600 a year - and some much more.

No single financial institution has a monopoly over the best value loans, savings accounts and credit cards, and Mozo director Kirsty Lamont said there was little reward for being loyal. She said many people felt switching was too much of a hassle but most would be better off "cherry picking" products.

Mozo’s Kirsty Lamont says government regulations help make switching banks painless.
Mozo’s Kirsty Lamont says government regulations help make switching banks painless.

"There's millions of Australians who could be losing thousands of dollars a year due to uncompetitive interest rates and fees," she said.

"The switching process for banking has become a lot easier in recent years. In many cases you can do it all online now."

BANKING: A quick new way to boost your credit score

Government regulations allow you to contact your existing bank for a list of direct debits and credits, then give it to the new bank, which will contact all suppliers with your new account details. "It's not really well known. I don't think the banks promote it because they don't want us to switch," Ms Lamont said.

Finance specialist Lisa Montgomery says people are often too loyal to their first ever bank.
Finance specialist Lisa Montgomery says people are often too loyal to their first ever bank.

Mozo's analysis of 117 financial institutions found that ME is the nation's best-value bank, while Westpac is the best value among the Big Four.

Mortgage and consumer finance specialist Lisa Montgomery said some people felt switching would simply mean "more of the same".

"We don't prioritise it in our lives as being a thing that will deliver us enough value," she said.

Ms Montgomery said many people were loyal to the first bank they used, which skewed them towards major banks with school banking programs. Others were loyal to banks their parents used - also benefiting the Big Four, she said.

Before switching, people should examine their existing relationship with their financial institution. "If you leave, will it cost you money, and is the grass greener on the other side?"



'Ipswich's sweet side': Strawberry lovers get behind farmers

premium_icon 'Ipswich's sweet side': Strawberry lovers get behind farmers

Fruit sales and prices recover ahead of "Strawberry Sunday"

Mum is no longer the word on teen pregnancy

premium_icon Mum is no longer the word on teen pregnancy

Classes open for Ipswich teen mums

Third year in a row for Ipswich artist to win top award

premium_icon Third year in a row for Ipswich artist to win top award

The awards are Flying Arts Alliance's annual visual arts prize

Local Partners