One of Australia’s big four banks has revealed a bold new plan to stop problem gamblers in their tracks at the royal commission today.
ANZ CEO Shayne Elliott took to the stand this morning to face questioning from senior counsel assisting the commission Rowena Orr QC regarding the bank’s conduct.
But among the grilling over overcharging, Mr Elliott also managed to drop a few surprise revelations.
One involved ANZ’s new plan to set credit limits in a bid to crack down on problem gambling.
Under the new policy, Aussie credit card users will be prevented from using more than 85 per cent of their available credit at gaming venues.
Mr Elliott said there was a fine line between respecting individual rights and providing credit responsibly, likening the situation to the responsible service of alcohol in the hospitality industry.
“While people can use their own money to … participate in certain legal activities, when you’re using a credit card, essentially, that’s the bank’s credit provision, and we do have a responsibility there,” he said.
“And we use the simple analogy to think about this as if we were running a bar. There is a responsibility not to serve people … if they’re intoxicated.
“And we tried to apply those principles here to provide some level of protection to customers so they would not get themselves in harm’s way by using our products perhaps irresponsibly.”
While the new policy is yet to be rolled out, Mr Elliott said the bank would set the limit on all customers’ cards automatically, with no option to opt out.
“Once they hit 85 per cent you won’t be able to use the final piece on a gaming — in a gaming venue,” he said.
However, the measure has been met with a mixed reaction among everyday Aussies on social media, with some arguing it was an example of “nanny state rubbish” while others claim the crackdown does not go far enough.
— Corporate Governance (@CorpGovResearch)
This is nanny State rubbish. What right does a bank have to tell people how to spend their money? What is next, do we need written permission from the Dept of health before we go out and eat? This is ridiculous.— Vass (@Vass2016)
Mr Elliott also revealed the bank was no longer investing in tobacco organisations — and that he had argued in favour of his own 23 per cent year on year pay cut, largely as a result of the bank’s shattered reputation as a result of the royal commission’s findings.
He said he had contacted the ANZ board’s remuneration committee to request his package was slashed by more than average.
“The … average percentage of target is 77 per cent for published execs. I feel it’s very important that my own remuneration is at no higher than this. It’s about unity, accountability and frankly credibility — externally but even more importantly internally,” he explained to the committee.
“I can’t ask my people to be down 22 per cent unless my own … reflects a similar number. I want you to reassess your recommended CEO (remuneration) as a result and have time to consider.”
Earlier today the commission also heard two million customer accounts had been overcharged due to a number of processing errors.
The staggering mistake is costing ANZ hundreds of millions of dollars in compensation to affected customers and costs.
When asked by commissioner Kenneth Hayne how so many mistakes could have occurred, Mr Elliott said human error was largely to blame.
“Applying for a mortgage and processing that through sounds reasonably simple. There are 408 steps in that process at ANZ. A large number of those steps are manual,” he said.
“That’s why things go wrong in the first place. And there is a myriad of systems behind it all, technology. That in and of itself is complex and it’s not fit for purpose and we’re redesigning that.”
Mr Elliott also shared the seven promises the bank had made to affected customers: We will listen, we will apologise, we will compensate, we will commit resources to fix the problem, we will explain our approach clearly, we will act speedily, and we will learn from the mistakes.
Ms Orr also revealed that in the past 10 years, ANZ had shut down 55 branches in inner-regional, 44 in outer-regional, six in remote areas and four in very remote parts of Australia.
“So what we’re seeing is a significant fundamental in traffic in our shops, if you will. That fundamental has approached 20 to 30 per cent over a couple of years, and shows no sign of slowing,” Mr Elliott said in response.
“So, essentially, we are confronted with a dilemma where we have shops and a distribution network with less and less people in it, and, therefore, at some point they become uneconomic.”