Finance Regulator Taking Westpac to Court over Hardship Cases
ASIC Sues Westpac over Alleged Mishandling of Customer Hardship Requests
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Australia’s oldest bank, Westpac, is facing legal action as the Australian Securities and Investments Commission (ASIC) alleges that it failed to respond to financial hardship notices from hundreds of customers.
The civil action, which involves 229 impacted customers, will be launched in the Federal Court this week.
According to ASIC, between 2015 and 2022, these customers did not receive a response to their hardship notices within the required 21-day timeframe. The regulator believes that submitting a hardship notice, which leads to a change in the credit contract, can serve as a crucial lifeline for individuals facing challenging financial circumstances.
"Westpac’s failures to respond to these notices compounded their customers’ difficult financial circumstances," stated ASIC deputy chair Sarah Court, emphasizing the adverse impact caused by the bank's negligent handling of the situation.
Importance of Timely Response to Hardship Notices
ASIC's decision to take legal action against Westpac highlights the significance of lenders promptly addressing hardship notices to minimize harm to their customers. Under the National Credit Code, lenders are required to notify customers signaling hardship within 21 days if they do not agree to modify the current contract or if they require additional information to make a decision.
In addition to the delayed responses, ASIC further alleges that Westpac did not adequately investigate and address system issues affecting its online hardship notification process.
In response to the allegations, Westpac acknowledged a technology failure, citing a high volume of approximately 630,000 hardship assistance applications between 2015 and 2022. The bank expressed regret for failing to provide the necessary support to some of its customers during this time.
Westpac's group chief information officer, Scott Collary, stated, "For this, we are deeply sorry." He confirmed that the bank had reached out to the affected customers as part of a comprehensive remediation program costing $900,000, which included refunds of fees and interest, debt waivers, and payments for non-financial loss. Westpac also disclosed the incident to the regulator.
The date for the first case management hearing is yet to be scheduled.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
The Reserve Bank of Australia’s latest policy minutes have added more detail to the rate outlook, reinforcing that borrowers should not assume easier credit conditions are just around the corner. While the cash rate has remained on hold, the discussion shows policymakers are still weighing inflation, household spending, wages growth and the resilience of the labour market before making their next move. - read more
Australia's latest retail payments snapshot keeps the spotlight on how households are using cards to manage everyday costs, irregular bills and discretionary spending. While monthly card figures can move around due to seasonal shopping patterns, tax-time expenses and changes in consumer confidence, the broader message remains important for borrowers: short-term spending decisions can quickly affect longer-term debt capacity. Find out now if you qualify and compare rates, offers and options from multiple lenders - without a credit check! - read more
The Reserve Bank of Australia's latest credit figures point to a continuing theme for households: Australians are still using personal credit as budgets remain under pressure. While housing and business lending often dominate the headlines, movements in personal credit are important because they can reveal how consumers are funding vehicles, renovations, travel, debt consolidation and unexpected expenses. Find out now if you qualify and compare rates, offers and options from multiple lenders - without a credit check! - read more
Getting a loan approved can be a critical step in achieving your financial goals, whether it's buying a home, starting a business, or consolidating debt. However, the loan approval process can often be complex and challenging, with many Australians facing difficulties in securing the loans they need. - read more
As Australians navigate the complex world of finance, understanding the nuances of borrowing can make a significant difference in one’s economic well-being. Being credit-savvy is not just about securing a loan; it's about making informed decisions that align with your long-term financial goals. In this pursuit, comparing loan options emerges as a crucial step for the financially conscious Australian. - read more
Stepping into the realm of loans and finance can be a daunting endeavor, but it all begins with a solid foundation in personal budgeting. Understanding how to manage your money effectively is not just a skill—it’s a crucial aspect of securing financial stability and achieving peace of mind. By tuning in to your finances and preparing a thought-out plan, you’re setting the stage for a well-informed loan application process. - read more
Need Help Finding a Loan?
Find out now if you qualify and compare
rates, offers and options from multiple lenders - without a credit check!
All finance quotes are provided free (via our secure server) and without obligation. We respect
your
privacy.
Knowledgebase
Monetary Policy: The actions of a central bank or other regulatory authority that determine the size and rate of growth of the money supply.
No comments yet. Be the first to share your thoughts.