Commonwealth Bank backflips on controversial $3 charge for customers to withdraw their own cash

The Commonwealth Bank of Australia has been forced into an embarrassing backflip on its controversial decision to charge customers $3 to withdraw their own money after a furious backlash.

It has announced it will ”pause” the changes and spend the next six months working with customers who would have been out of pocket.

The announcement comes after the bank held crisis talks after customers threatened to shut down their accounts and politicians slammed the move.

The bank told customers this week that those with Complete Access Accounts would be moved to a Smart Access Account and that from January 6 it would charge customers a $3 fee when they withdrew cash from a branch, post office or by using the phone.

The fee would have applied to customers moved to the new transaction accounts. Age, service and disability pensioners, customers aged under 18 and people with disabilities that require them to use branches were to have the fee waived.

On Wednesday, Retail Banking Services group executive Angus Sullivan said the bank would now “rethink” how the fee changes would be implemented and spend the next six months working with complete access customers who would have been out of pocket.

He admitted the bank — which posted an annual cash net profit after tax of $9.8 billion in the 2024 financial year — “didn’t get the communication right on this”.

Treasurer Jim Chalmers said he spoke with CBA chief executive Matt Comyn on Wednesday morning to make it clear the Government’s view the changes were unacceptable.

He welcomed the bank’s announcement it would rethink the move.

“We are talking in most instances about some of the most vulnerable people in the banking system,” Dr Chalmers said, speaking shortly after the bank’s statement walking back the changes.

“We want to make sure people aren’t worse off. People are doing it tough enough as it is and they do not need this close to Christmas or any other time.”

Mr Sullivan acknowledged that “account changes are difficult, and especially at this time of year and with so many Australians challenged with cost of living pressures, we’ve decided to announce a change in our approach”.

”For our complete access customers, which is roughly 10 per cent of our 10 million odd customers, there are approximately 90 per cent of our complete access customers for whom the change that we announced yesterday would put them in a better or equal position to today.

“For those customers, we will continue with migrating them to the lower monthly account keeping fee bank account option.

“If that doesn’t work for customers, of course, they can be in contact with us and we can arrange an alternative solution for them, but the other customers, those that we expected might be slightly worse off and need more support in making sure that their banking arrangements were appropriate, we’re going to pause the changes that we announced, and we’re going to spend the next six months individually engaging with each of those customers to make sure that we have a solution tailored for each one of them, rather than a simple migration across to the Smart Access account.”

Before the about turn on Wednesday, Housing Minister Clare O’Neil lashed out at the bank, slamming the $3 fee during an interview with Nat Barr on Sunrise.

“The Government feels like it is really unfair on Australians, especially just before Christmas. Everyone has had a tough year on the cost-of-living front, the last thing they need is a kick in the guts from the Commonwealth Bank,” she said.

“It doesn’t seem fair or appropriate and this is a huge bank making huge profits. Come on, guys. It’s Christmas. We don’t need this right now.

“This is not something the bank should be doing and we’re asking them to reconsider.”

Shadow Finance Minister Jane Hume was also fuming.

“I don’t know what kind of greedy, out-of-touch executive decided on this idea. It’s ridiculous and customers will speak with their feet. There is no doubt about it, including myself, actually,” she said.

“I have a Commonwealth Bank account that I’ve had since I was at university. I will be shutting it because of this decision. I don’t know whether it’s a Complete Access account or not. It’s a bad decision and I will be shutting my account. Merry Christmas!”