Ditch banks for better deal: Choice

BORROWERS and financial services customers are being urged to ditch Australia's big four banks and seek out better deals with smaller lenders.

Mortgage customers can save $2500 a year by switching from the big four, consumer group Choice says.

As well, credit card and savings account holders could save up to $440 and $330, respectively, by switching.

With the Federal Government due this week to unveil reforms to increase competition in the banking sector, Choice yesterday encouraged Australians to size up their banks under its ongoing Better Banking campaign.

Choice's Better Banking campaign director, Richard Lloyd, said around 80 per cent of Australians hadn't even considered switching banks in the last two years.

“Of course that's what the major banks rely on, they rely on lots of Australian consumers staying where they are and that's when you get hit by high fees, poor interest rates and unfair terms,” he said.

“What we're saying today is: ‘Consumers, don't wait for the Government's reform package ... if you take simple steps now you can give yourself an early Christmas present'.”

Mr Lloyd said smaller banking sector players were usually those offering the best deals, and that consumers should not be nervous about moving to smaller finance institutions as they were regulated in the same way as their bigger competitors.

Federal Treasurer Wayne Swan has backed Choice's campaign.

“I'd encourage every Australian family to check out the range of products on offer and compare them to the big banks,” he said.

Mr Swan is expected to unveil aseries of measures aimed at increasing banking competition tomorrow.

Choice yesterday launched a new free section on its website, choice.com.au/betterbanking, to make it easier for customers to compare bank rates.

The new site allows people to compare fees and interest rates from all the banks, as well as credit unions, building societies and other non-bank lenders.

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