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The term "penalty fees" is sometimes used to describe the charges that banks and other providers may apply when an account is not kept in good standing. For example, if someone with a credit card does not pay the minimum amount required by the due date, they could be charged a late payment fee.
These charges are more commonly referred to as "exception fees" in Australia. Following widespread banking reforms and industry scrutiny over the past few years, there are very few of these fees that currently apply to credit cards and other bank accounts. But they could still add to the cost of your account if you ever have to pay them. So here, you can learn more about what exception fees could apply and how to avoid them.
The range of fees that could apply to your credit card or other bank accounts varies depending on your financial institution. But some of the most common include:
These fees are less common than the ones above, but are still worth keeping in mind:
The cost of these charges largely depends on your bank and the specific account. In general, most exception or "penalty" fees range from $4-$20. To give you some idea of the charges that could apply, the table below shows what penalty fees Australia's major banks ANZ, CommBank, NAB, St.George and Westpac charge and how much they cost if they apply to your specific account.
Bank | Dishonour fee | Overdrawn account fee | Credit card late payment fee | Credit card overlimit fee |
---|---|---|---|---|
ANZ | $6 | $6 | $20 | $20 |
Commonwealth Bank | $5 | $15 | $20 | $10 |
National Australia Bank | $30 | N/A | $15 | N/A |
St.George | $9 | $9 | $15 | $15 |
Westpac | $5-$9 | $15 | $15 | $15 |
Note that these penalty fees may not be applied to every account you have. Each lender has its own set of account terms and conditions, so it's important to refer to your credit card or bank account Product Disclosure Statement for full details of which fees you could be charged and how much they will cost you.
Here are some ways by which you can guard against being hit by bank penalty fees:
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Hello I recently went on a holiday to New Zealand and we ran out of money we allocated so went to and atm and withdrew money from our account now looking at statement on top of being charged a 3.00 fee per transaction the bank has charged a $35 international transaction fee is this legal as we have already paid high fees for this l?
Was a visa debit card and never went over limit etc was our own savings.
Hi Nick,
Thanks for your question.
You might want to review your card conditions of use to see the specified fees for overseas cash withdrawals. Typical fees for overseas withdrawals can include a foreign transaction fee (which is likely the 3% fee you mentioned) and may also include an international transaction fee. Your bank needs to clearly set out the fees and charges you will incur for every type of transaction, so you can see if they have and then discuss the matter with them.
I hope this has helped.
Thanks,
Elizabeth
Could you tell me the law on charging my home loan from one bank to a other bank, are there any fees?
Hi Len,
Thanks for your question.
Please refer to our guide on avoiding exit fees when repaying a home loan early. You can use our switching costs calculator to help work out the savings from moving from one loan to another.
I also recommend getting in touch with a licensed mortgage broker. A broker can help you understand your financial position and they can leverage their panel of networks to find a lender that is more inclined to review your application.
I hope this helps.
Cheers,
Jacob