The boss of Australia’s biggest bank has angrily denied ripping off customers with card fees as Australia moves ever closer to becoming a cashless society.
Commonwealth Bank chief executive Matt Comyn was questioned about tariffs at the House of Representatives economics committee on Thursday.
“The marginal cost of electronic and digital payment has fallen substantially and those cost savings have been substantially passed on to consumers,” he told the Canberra hearing on Thursday.
The exchange became heated when first-term Labour MP Jerome Laxale asked whether the savings on digital costs had actually been passed on to consumers, to which Comryn replied: “Absolutely.”
“All the evidence will show…” he said.
Mr. Laxale interrupted him and laughed: “That’s not a saving.”
Tensions rose when the Labor MP held up a Mastercard labelled $5.08 and a $5 note to highlight typical fees of 8 cents for a small transaction.
“That’s not a saving,” Mr. Laxale said again.
Commonwealth Bank chief executive Matt Comyn has been adamant that those who pay digitally are now charged less per transaction.
The exchange became heated when first-term Labor MP Jerome Laxale questioned whether savings on digital costs had actually been passed on to consumers.
Mr Comyn rejected her argument, closing his eyes in front of MPs in the lower house as he tried to contain his anger.
“It’s a false comparison and I’m certainly not directing it at you – I find it somewhat alarming in the context of this, this is not about the Commonwealth Bank, but I see this time and time again,” he said.
‘Time and again, Australian businesses are portrayed through this false dichotomy.
‘For a company to make any kind of revenue or profit, it is often inferred – or directly related and not necessarily by you, Mr Laxale, but on a daily basis – that this is somehow unfairly extracted from consumers and I think this kind of continued rhetoric, often devoid of facts, that has been published more widely is very damaging.
“And I say it’s damaging because it’s eroding trust in institutions, in all of our institutions. It’s a real cause for concern.”
For much of the hearing, Mr Comyn stared down at the table rather than directly at the MPs questioning him.
Commonwealth Bank chief executive Matt Comyn told a tense hearing in Canberra that Australians who relied on digital payments were now being charged less for each transaction.
Price comparison website Canstar revealed in February that total card fees rose by $400 million last year to a whopping $4 billion.
It is estimated that Australians spend an average of $140 on hidden fees.
While inserting a card into an EFTPOS machine typically costs a merchant less than 0.5 percent per transaction, using contactless payment with Visa and Mastercard can cost between 0.5 and 1 percent each time for debit cards and 1 to 1.5 percent for credit cards.
On a $100 purchase, the average added cost is 28c for EFTPOS, 52c for using the Mastercard network, 47c for using Visa and a whopping $1.88 for digital payments provider Square.
Costs are one of many reasons why more Australians are expressing concerns about Australia’s transition to a cashless society, as physical branches and ATMs continue to close.
During the financial year 2022-23, The Australian Prudential Regulation Authority showed that 424 bank branches have closed.
The number of branches has been reduced by more than a third, or 37 percent, between June 2017 and June 2023.
The banking regulator’s figures also showed the massive dismantling of ATMs, the number of which plummeted by 60 percent in just six years.
In one year, 718 ATMs were removed.
Commonwealth Bank posted a net cash profit of $9.836 billion in 2023-24, down 2 per cent from the previous financial year.
Mr Comyn earned $10.426 million in 2022-23 based on his total compensation with short- and long-term bonuses.
