Fair Play on Fees settles fight with Kiwibank
Bank fee action group Fair Play on Fees has reached a confidential settlement with Kiwibank.
The group had planned class action suits against many of the major banks over the default fees they charge customers.
It argued that the fees were out of proportion with the cost of the defaults to the banks, and were unenforceable penalties. More than 7000 customers had signed up to the Kiwibank class action, Fair Play on Fees had said.
The claim lost some of its steam in this country last year after the Australian High Court dismissed an appeal there, and found that credit card late payment fees were not penalties.
READ MORE: Fair Play on Fees case against ANZ settled
A settlement was reached with ANZ last October.
It was confirmed on Monday that Fair Play on Fees reached a settlement with Kiwibank on March 16.
"Kiwibank does not admit any liability and all claims against it will be withdrawn. Details of the settlement are otherwise confidential."
The lead plaintiffs for the Kiwibank case were Auckland couple Leanne and Sydney Briggs. The Briggs' banked with Kiwibank for six-and-a-half years and in that time were hit with more than 100 default fees, totalling almost $2,000.
Leanne Briggs said she was regularly charged despite having transferred money to her account the day before to cover an automatic payment.
"Technically Kiwibank said I was still overdrawn because the money didn't go in until the following day because the payment went out that same morning. The default fees happened so often and I couldn't do anything about it, no matter how many times I called."
She was once charged $10 plus interest for being 2 cents overdrawn on a mortgage payment for a few days.
Lawyer Andrew Hooker, the face of the action in New Zealand, said a common theme among the Kiwibank complainants was that they had joined the bank because they were frustrated with the way they were being treated by their Australian-owned banks. "These customers were then bitterly disappointed to find they were treated no differently by joining a Kiwi-owned bank.".
It had also filed against ANZ and Westpac.