Banks supporting customers across Australia with 3 month deferrals, merchant fee refunds

FULL TRANSCRIPT: ABA CEO Anna Bligh spoke with 2GB Radio’s Deborah Knight.

Banks are offering a National Support Package, available to all small businesses and home loan customers significantly impacted by current lockdowns or recovery from recent lockdowns, irrespective of location or industry.

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Deb Knight:  From the pandemic last year we saw banks join forces with the Government and other businesses doing what they could to help those who are struggling with the lockdowns. People were doing it tough then, and they are again now 12 million people are being impacted by the lockdowns currently and New South Wales and in Victoria.

And after the shutdown of the construction industry in Sydney, we’ve had call after call email after email from people who are beside themselves that just don’t know where to turn for support. Sam was one of those who called in yesterday, just one of the many who just doesn’t know how he’ll make ends meet.

“Sam”: Pretty much I’ve been told that might not have a job to go back to. And I’m one of those guys who actually live week to week, I’ve got a mortgage to pay, I’ve got a car to pay for, I don’t know what to do, I’m at my wit’s end.

Deb Knight:  A grown man, a tradie, on the brink of tears, and suddenly you’re in the same boat. Well, banks are offering to help. And Anna Bligh from the Australian Banking Association is on the line for us now.

Anna welcome to the show. We’ve heard stories like Sam’s all day yesterday, and people, many of whom were impacted by the pandemic in the last lockdown. They’re really frightened about the financial situation, how can the banks help them out?

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Anna Bligh: Well, hello, it’s nice to talk to you. And I’m very pleased to be able to reassure people like Sam and many others who might be listening that Australian banks are ready to step up and to do their part and help people wherever they can.

Banks are offering the option for home loan borrowers to defer their mortgage repayments for up to three months. It’s a bit hard to know at the moment, because it’s not it’s not like last time where we had a much clearer idea about how long we might be in lockdown. But for now, we think three months is likely to get most people through the worst of it.

And I do think we certainly banks certainly understand that there are people, you know, in the construction industry, who are going through this for the first time, and it is very scary. And that’s why we wanted to get out there and let people know, relief is at hand, all you need to do is be talking to your bank.

Deb Knight : So mortgage deferrals for individuals, which is an important step. What about for businesses? How are banks supporting, particularly, small business?

Anna Bligh:  Similarly, for small businesses, banks will be offering similarly, deferrals of up to three months on their business loans.

They’re also throwing into that support package refunds on their merchant fees. Every time you tap and go, every time you use your card, the small business accrues a small transaction fee that can add up, depending on the kind of business you’ve got – banks have that as part of that package of support, offering a refund for that three month period on merchant fees.

So all of that, hopefully, for mortgage holders, for small businesses with business lines that are shut down at the moment. It’s about offering people peace of mind, and we hope it does that.

“these options do give people you know, a breather, that’s what they’re designed to do, just take the load off for three months, while you get through everything else that you need to get through.”

ABA CEO Anna Bligh

Deb Knight: People certainly do need that. And what sort of demand are you seeing for help this time around? because I know that some of the big bank bosses from the ANZ and the NAB are saying that they are really getting a lot of people getting in contact with the banks.

Anna Bligh:  Yes, it’s not quite the deluge that we saw in early 2020. But banks are reporting that they’re starting to see a significant uptick in the number of people who are ringing their helplines, and that the people who are ringing are in a lot of distress.

Many of them, as I said, have not been through this process before, their business, if its because of the nature of their industry and the differences this time, their business last time wasn’t shut down. So this is a first time experience and our call centre staff from banks, once again dealing with people who are very, very frightened and distressed.

But these options do give people you know, a breather, that’s what they’re designed to do, just take the load off for three months, while you get through everything else that you need to get through. Don’t worry about your mortgage, don’t have to worry about your business loans. And then hopefully, we’ll be through these lockdowns and you’ll be back at work.

Deb Knight: What about people who are tempted to try to get short term loans or the use of the buy now pay later services to make ends meet, because we are seeing an increase in popularity in that field.

Anna Bligh: It’s quite interesting. What we saw last time was that firstly, many people took out a deferral and in the end, they didn’t need it, because they ended up getting paid for the whole period.

They took it out and they kept paying their mortgage even though they’d taken out the deferral. They took it out because they were uncertain about what would happen and they needed that comfort.

We also saw higher spending on groceries and stocking up again because people were worried about what might happen. It will be interesting to see this time given we’ve been through it before. Whether people are a little more relaxed about the groceries that are going to be in the supermarket: “I don’t have to do three months of shopping right now”.

You know, people will have credit card payments and personal loan payments. Sam, I think said he had a car loan. That’s something that banks will also be happy to talk to you about that, you know, they don’t have a uniform agreement across banks. It’ll be a case-by-case, depending on the customer. But that’s something you can also talk to your bank about.

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Deb Knight : So put the call in if you if you think you need help. And look, I know you’re proud Queenslander that you must be pretty excited about the prospect of the Olympic games coming to Brisbane in 2032.

Anna Bligh:  Well, I certainly hope that, you know, it’s successful, I think, the spin off and the economic buzz that that creates is something that would be great for the whole country to have to look forward to.

Deb Knight:  Yeah, absolutely. If you were the premier in the current climate would you be going to Tokyo the same way that Annastacia Palaszczuk is?

Anna Bligh:  Look, I’m not going to buy into that. I don’t know enough about the circumstances of the bid. I do know that when I was leading the bid for the Commonwealth Games, which the Gold Coast successfully won, there is an expectation that you’ll be there talking to people and selling your bid.

So, you know, there’s a lot of politics flying around. What I know is that I don’t envy any Australian political leader right now. They’re dealing with some of the toughest and most difficult decisions that any political leaders dealt with outside wartime. I just take my hat off to them and hope that they keep getting it right and banks working with them can help make a difference in people’s lives.

Deb Knight: Hear hear, and you’ve got enough on your plate with the Banking Association as it is Anna Bligh. Always good to talk. Thanks so much for joining us.

Anna Bligh: Thank you.

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2GBAnna Blighbank assistancecovid-19lockdownRadio Interviewtranscript