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What is a basic bank account?

A basic bank account is a transaction account that has fee-free features and provides eligible customers with an account they can receive their government benefit payment into and access free banking transactions. The following have been identified in an ABA review of banking offerings as commonly-recognised account features for a basic bank account:

  • No account keeping fees: Customers are not charged an account keeping fee no matter how they use the account.
  • Free monthly statements: Customers are not charged a fee for receiving a monthly account statement, if they chose this frequency. In addition, customers can choose to receive the statement electronically (via email if this option is offered), in hard copy (by mail), or statements can be viewed via Internet or mobile banking.
  • No minimum deposit amounts1: Customers do not have to maintain a minimum account balance to open an account.
  • The ability to set up and cancel direct debits: Customers can set up and cancel a direct debit with different service providers (such as utilities, insurance companies, etc) for free.
  • No overdrawn fees2: Customers will not be charged an overdrawn fee if they make a payment, transfer or a direct debit while there is insufficient or no money in their account (in other words, if their bank account is ‘in arrears’).
  • The ability to access a debit card at no extra cost3: If a customer would like a debit card linked to their transaction account (such as a card with a Visa or MasterCard logo), their bank will link one to their account for free. Some banks may restrict eligibility for some types of debit card by age. Some banks may combine the debit card with your ATM card.
  • Free and unlimited transactions through all of the following banking channels:
  • –  Branch (over-the-counter services)

    –  Telephone banking

    –  Internet and mobile banking4

    –  Electronic Funds Transfer at Point of Sale (EFTPOS)

    –  Bank owned and networked Automatic Teller Machines (ATMs) across Australia5

1 Some banks may require a customer to have their government benefit payment paid into this account.

Some banks do not allow an account to go into ‘arrears’, which means that if there is not enough money in your account, a payment, transfer, or direct debit will not be processed. However, if your bank does allow these transactions, you will not be charged an overdrawn fee when this happens.

A debit card linked to a transaction account comes with EFTPOS, Visa or MasterCard logos. A Visa or MasterCard debit card can be used to make purchases and transact online.

Some banks do not currently have mobile banking functionality where a customer can access their account from their smartphone or via an app and their online banking channel is available via Internet banking.

If customers choose to use ATMs which are not operated by their bank or part of a networked arrangement in Australia, the customer may have to pay an ATM direct charge (“ATM fee”) to the ATM operator to complete their transaction.