Treasurer Jim Chalmers announces new banking reforms to help mortgage holders get better deals

Homeowners under pressure from interest rate rises will get help to switch to better mortgage deals under a suite of Federal Government reforms.

Treasurer Jim Chalmers will on Saturday announce a package of initiatives to help customers get better rates on their mortgage and savings accounts.

Under the changes, the Government will make it easier for customers to switch loans by ensuring they have easy access to documents needed to exit a mortgage.

Customers would also be given more notice about bonus interest rate offers and when the period for introductory rates end.

Banks will also be forced to notify customers when their interest rate changes on their transaction or savings account, while comparison website will be required to disclose how products are ranked.

Treasury will be tasked with investigating what prompts could be used to spur consumers to switch to better loans.

The changes are in response to two inquiries from the Australian Competition and Consumer Commission.

“The changes will help bank customers get a better deal, including through more choice, lower prices and better services,” Dr Chalmers said.

“They will help create a more dynamic, diverse and resilient Australian banking sector, which is good for consumers, good for industry and good for the economy.”

Dr Chalmers will also announce a new inquiry into the challenges confronting small and medium-sized banks.

The inquiry will probe the role of smaller banks in providing competition and examine the regulatory and market trends affecting them.

The review which will be led by the Council of Financial Regulators in consultation with the ACCC.