ASIC takes aim at major bank

The regulator claims the major failed 345 customers “at their most vulnerable” between 2018 and 2023, after not responding to hardship applications within the 21-day time frame required by law.

“We allege NAB unlawfully failed to respond to their customers’ appeal for help when they needed them most,” said ASIC chair Joe Longo.

“These customers included people who were domestic violence victims, battling serious medical conditions, dealing with business closures or job loss. NAB’s failures likely compounded the already challenging situation for these people.”

According to NAB, financial assistance is an option for customers struggling to stay on top of finances, which can be accessed in either short-term or long-term assistance.

“If you’re struggling with your finances, it’s important that you reach out to us as soon as you can. Financial difficulty can happen to anyone. If you’ve had an unplanned life event like unemployment or reduced income, a relationship breakdown or domestic violence, a natural disaster, illness or injury or if you just need some temporary support, we can help,” said NAB.

With the cost of living remaining high and interest rates yet to be cut, ASIC said that there are many who are falling back on these offerings to keep afloat.

“Amid rising cost of living pressures, we have seen an increased number of customers reach out to their lenders for relief, and we have seen first-hand the impact on lives and livelihoods when lenders fail to appropriately support customers experiencing financial hardship,” said Longo.

“Compliance with financial hardship obligations is an enforcement priority for ASIC in 2024. Earlier this year, we put the lending industry on notice on the release of our hardship report. We will not hesitate to take decisive action when banks and lenders fail to comply with their obligations.”

ASIC has previously warned lenders on financial assistance, saying that they need to do better. This came after a report found that some home loan lenders have made accessing financial assistance so difficult that 35 per cent of lender customers dropped out of the application process at least once.

Further, the report said that 40 per cent of customers who obtained hardship assistance through reduction or deferral of payments fell into arrears right after the assistance period ended.

“For people who reach out to their lender to signal they need support, this can be devastating. Too many Australians in financial hardship are finding it hard to get help from their lenders and it’s time for meaningful improvement,” said Longo.

“This report highlights lenders must improve the way they deal with customers experiencing hardship. What we have seen is simply not good enough – struggling customers deserve the right support in their time of need.”

Related: Lenders need to do better on financial hardship assistance

Jack Campbell is the editor of Broker Daily. After graduating from the University of Wollongong in 2022, Jack began his journalistic career working on Broker Daily’s sister brand, HR Leader. In August 2023 he was made the news editor and worked alongside some talented journalists writing articles and recording podcasts.

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