The Members Equity Bank, owned by industry super funds, changed policy for 20,000 borrowers that removed funds from redraw accounts to pay down home loans last week without proper notification.
“We are sorry,” chief executive Jamie McPhee said in a statement released on its website, who explained the change was made on one of the lender’s legacy home loan products. “Absolutely disgusting treatment by a bank, helped yourself to our redraw with no communication whatsoever,” one user said. Ms Guthrie said growing redraw accounts through making payments above the loan requirement was a responsible avenue to build up funds for access during leaner times, such as a pandemic-induced economic crisis.“Banks market this in the good times as providing that so you can’t just turn it off when the situation arises where you would think this would be useful for people.
“Firstly the communication has not been fair, timely or appropriate – most of it has been after the fact,” she said in a statement to news.com.au. “With the current uncertainty surrounding coronavirus, we’re taking steps to continue providing the financial support our customers need,” the lender said in an email to its borrowers.Customers can opt-out of this change but Ms Guthrie said it should have been on an opt-in basis, saying she sees the merit in supporting customers by freeing up cash during times of financial hardship but the major bank should have allowed customers to decide how they would proceed with their repayments.