The ACCC has issued a final determination to authorise Australian banks which are members of the Australian Banking Association to continue working together under the Banking Code of Practice to help more low-income Australians access low-fee and no-fee bank accounts, and to assist farmers during droughts and natural disasters.

In 2019, the ACCC authorised Australian Banking Association (ABA) member banks to collaborate under the Banking Code of Practice on the minimum eligibility criteria and features of basic and other low or no-fee accounts for eligible customers facing hardship.

The authorisation also allowed banks to suspend default interest charges on agricultural loans during a drought or natural disaster.

The ABA has applied for re-authorisation of the conduct, which the ACCC has granted with new conditions designed to broaden access to these lower-fee accounts.

The conditions imposed by the ACCC require banks to offer eligible new customers basic, low or no-fee accounts. They also require banks to proactively identify existing customers who may be eligible for lower-fee accounts and move them unless they choose to opt out.

"These conditions will help more eligible Australians access lower-cost banking products and avoid bank fees that significantly impact people on lower incomes," ACCC Deputy Chair Mick Keogh said.

"We want banks to do more than simply make these accounts available. They should actively identify customers who may benefit and make sure they are aware of their options."

The authorisation also allows banks to continue providing relief to farmers by suspending default interest charges on agricultural loans during droughts and natural disasters.

"These protections can make an important difference for farmers experiencing drought or recovering from natural disasters times when many face significant financial pressures," Mr Keogh said.

In assessing the application, the ACCC considered research from the Australian Securities and Investments Commission, which found more than 150,000 low-income customers remained holders of higher-fee accounts despite being eligible for lower-fee alternatives. These customers were charged $6 million in fees over a 12-month period.

"We are concerned that some eligible customers may still be paying unnecessary fees because they are unaware that lower-cost accounts are available or face significant barriers when trying to switch their accounts," Mr Keogh said.

To address these concerns, the ACCC has imposed conditions requiring Australian Banking Association (ABA) member banks to:

* offer and provide information to eligible new customers about basic, low or no-fee accounts

* migrate eligible existing customers to these accounts, with customers given the choice to opt out

* at least once annually, take reasonable steps to identify and directly contact existing customers who may be eligible but are not already using these accounts

* not charge interest on informal overdrafts on basic, low or no fee accounts, or refund any interest charged.

The ACCC has granted authorisation with these conditions for five years. The ABA is required to report annually to the ACCC.

Basic bank accounts have no account keeping fees and provide free everyday banking features, including direct debits, debit card access and unlimited transactions within Australia.

Eligible concession card holders can also benefit from protections such as no dishonour fees, no overdraw fees and restrictions on informal overdrafts.

More information, including the ACCC's determination, is available on the ACCC's public register at Australian Banking Association (Banking Code of Practice).

Background

The ACCC granted interim authorisation with conditions on 4 December 2024 while this application was considered.

The ABA represents 20 banks, 17 of which have a retail banking presence in Australia. It is a condition of ABA membership that member banks with a retail presence in Australia sign up to the Banking Code of Practice.

The Code sets standards for how Australian banks deal with individual and small business customers.

In 2020, the Code was updated to implement recommendations from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, including commitments relating to basic accounts and agricultural loans.

The most recent version of the Banking Code of Practice was released in February 2025 and is available on the ABA's website.

Note to editors

Australian competition law recognises that, in some circumstances, activities that might breach the competition laws may have a net public benefit.

ACCC authorisation makes it possible for such activities to go ahead without breaching the law.

The ACCC must not make a determination granting authorisation unless it is satisfied, in all the circumstances, that the conduct would likely result in a benefit to the public and that benefit would likely outweigh any potential detriment from the conduct.

The ACCC may impose conditions to ensure that the authorisation test is met, or continues to be met, over the term of the authorisation.