2009 Corporate Responsibility Review
Feature Stories
Our customer promise
In April 2008 we launched NAB's 'Customer Promise'. It set out what our retail customers can expect of us, and gave our employees a greater appreciation of the service standards we need to provide.
Of the 24 commitments we made, 16 were met, another three were substantively met and on five we have fallen short. These five are:
- Give you a decision on your personal loan or overdraft application within one business day;
- Give you a decision on conditional approval for your home within two business days;
- Ensure that when you call 13 22 65, you don't wait more than 60 seconds in our call centre queue, 90% of the time;
- Answer your email enquiries within one business day; and
- Resolve most complaints when you first make them, and resolve more than 90% within five business days.
We aim to improve our performance in these areas, and have launched a number of major initiatives in pursuit of this goal.
Clear value and transparency
In July NAB and BNZ announced the abolition of overdrawn account fees on personal transaction and savings accounts. The fees affected over 700,000 customers each year and generated more complaints to NAB than any other issue.
The change came into effect on 1 September 2009. We believe that abolishing these fees will help us build better relationships with our customers, and also with our people, for whom the fees were a source of significant frustration. The decision made NAB more competitive within the industry, and prompted the other major banks to make their own announcements on fees. We estimate, as a consequence of NAB's leadership on fees, that $700 million will go back into the hands of customers every year, industry–wide.
The decision was received positively by customers, media and consumer advocacy groups. Personal Banking continues to evaluate opportunities to make fees fairer and more transparent. We are also focused on providing help, guidance and advice to our customers; offering quality products and services; and acting with compassion and support.
Over the next 12 to 24 months we expect to undertake further initiatives in these areas.
A hand up, not a hand out
NAB supports a range of innovative programs that help improve access to fair and affordable financial services for Australians living on low incomes. NAB supports four not-for-profit microfinance programs in partnership with community and government sectors, and has committed $130 million in capital to these initiatives since 2003:
Microenterprise Loans –
Launched in 2007, NAB provides not-for-profit business credit to people with few or no avenues to access affordable credit. During 2009 115 microenterprises received unsecured business loans of between $500 and $20,000, totalling $1.6 million.
No Interest Loan Scheme (NILS®) –
In 2009 NAB increased its NILS® funding from $10 million to $15 million. NILS® provides small loans at no interest for the purchase of essential household goods and services (between $800 and $1,200). During 2009 NILS® provided over 2,600 loans totalling $2.1 million.
StepUP Loans –
Launched in 2004, StepUP Loans are a bridge between NILS® and mainstream credit, and provide small loans up to $3,000 at an interest rate of 3.99%. During 2009, 775 loans were written to a value of $2.1 million.
AddsUP Savings Plan –
NAB launched AddsUP in 2009 to give people an incentive to save. The program is currently offered in Queensland and Victoria through NAB's NILS® and StepUP Loans community partners. The program matches savings account balances once a year to a total annual value of $500.
NILS®, StepUP Loans and AddsUP programs are delivered in collaboration with Good Shepherd Youth & Family Service. The NILS® trademark is registered to Good Shepherd Youth & Family Service (No 766836).
The programs are unique in developed economies in terms of the scale of involvement by a bank. NAB has been recognised by five Money Magazine Best of Best Awards for socially responsible products. For more information visit www.nab.com.au/microfinance.
MLC - continuing to lead
MLC has continued to lead the industry on greater trust and transparency, announcing in September 2009 that Apogee Financial Planning and Garvan/MLC Financial Planning (MLCFP) would move to a fee for advice model for
all new investments and superannuation clients from 1 July 2010. This move means all of MLC's existing advice businesses will now use a fee based model. Godfrey Pembroke and NAB Financial Planning made the change in October 2006 and July 2008 respectively, and more than 70% of MLC's new investments and superannuation business is already written on a fee for service basis.
MLC believes the financial planning industry needs to look for other reforms beyond fees and commissions to improve clients' trust in the industry.
Steve Tucker, MLC CEO stated "Our industry is facing structural reform. We need to face the issues that are damaging the reputation of our industry and make meaningful changes that will start to build trust, improve transparency and truly put the customer at the centre of everything we do."
General Manager of MLC Advice Solutions
More ATMs – Less Fees
A significant highlight for our retail business in 2009 was the creation of one of the largest ATM networks in Australia.
NAB joined forces with Cuscal, a wholesale banking and transactional banking services specialist, to establish a combined network of more than 3,100 ATMs across rural, regional and metro Australia. This provides our customers with better access to convenient banking.
This partnership is now helping more than seven million people to avoid direct charge fees – which are incurred when a customer uses an ATM that is not linked to their own financial institution.
NAB and rediATM customers conduct more than five million ATM transactions per year on each other's ATMs. This new alliance will save our combined customers more than $10 million in direct charge fees every year.
