Banks make hay with penalty fees
Penalty fees charged by banks on periodic payments and late credit card payments have soared over the past four years. The Australian Consumers Association said that the average late payment fee has risen by 50 per cent, while penalties for exceeding a credit card limit have jumped from nil to $29. The ACA said the fees may be illegal, since they exceed the real cost of processing late payments or overdrawn accounts.
The Australian Bankers' Association denied the fees were penalties, and said customers could avoid them.