CBA teams up with Harvard University researchers to help customers better manage their home loan repayments

Commonwealth Bank today announced the launch of a smart new feature in the CommBank app that makes it simple and easy for customers to align their home loan repayments with the date and frequency of their regular incoming salary payments¹.

The launch follows a collaboration with Harvard University’s STAR Lab² to explore how the timing of large expenses relative to income can improve a person’s cash flow and make it easier to achieve better financial outcomes.

“People’s financial lives have so many moving parts,” said John Beshears, a professor at Harvard Business School and a member of the STAR Lab. “Income arrives on one schedule, and each major recurring expense, such as a home loan payment, often arrives on its own separate schedule. When these schedules are out of sync, many customers have difficulty planning their spending. Luckily, there are ways to help customers avoid this source of stress.”

CBA’s Executive General Manager for Home Buying, Dr Michael Baumann, said: “For many customers, home loan repayments are their biggest regular expense and traditionally repayments are monthly with the repayment date determined by the settlement date of a property.”

Last year more than 8 in 10 customers were paid weekly or fortnightly³, however for the majority of home loan customers their repayments are monthly.

“The new feature in the CommBank app is designed to give customers control to be able to align their home loan repayments to when and how often they are paid. Emerging research suggests seemingly small changes like aligning a customers’ repayment day with their pay day can make it easier for them to manage their finances.”

Dr Baumann said customers are increasingly engaging with their bank via digital tools and seeking out ways of completing tasks digitally.

“The digital self-serve feature provides customers with another option to filling out a form or having to speak to their CommBank lender or broker. It adds to our growing suite of powerful digital tools that provide unparalleled support and empower customers to self-serve throughout the entire home buying and ownership journey,” Dr Baumann said.

Going forward, the bank will nudge customers via alerts in the CommBank app to let them know about the new feature and how it could help them better manage their monthly finances.

The new feature complements CBA’s Home Buying Hub⁴, already located in the CommBank app.

Notes for editors

¹ The new CommBank app feature allows customers to personalise and align their home loan repayments with the frequency and date they receive their salary. Eligible customers can access the new feature via the CommBank app: Home Loan Account > Manage Loan > Repayments > Change Amount or Frequency.

² The Sustainability, Transparency, and Accountability Research (STAR) Lab at Harvard University have an ongoing collaboration with the CommBank Behavioural Science and Financial Wellbeing teams to better understand decision making and to improve the financial wellbeing of our customers. The STAR Lab brings together a group of scholars at Harvard University conducting research assessing new business initiatives aimed at improving accountability and sustainability and generating positive social and environmental impacts. Find out more.

³ In 2021, around 15 per cent of CBA customers that received a regular salary were paid monthly, while the majority were paid fortnightly (around 70 per cent) or weekly (around 15 per cent)

⁴ The Home Buying Hub is a tool targeted at guiding new customers through the home buying journey with checklists and prompts, ensuring they are ready to purchase the right property. We know home loans are a long-term commitment, so it’s important home loans change as a customer’s needs change. Our in-life experience makes it easier for customers to manage loans digitally to ensure it remains fit-for-purpose, from splitting and switching to managing offset and repayments all available digitally.