Commonwealth Bank data has revealed that more than a third1 of Australians are spending more than they earn each month.
Not only are Australians overspending, but the new data reveals this overspend contributes to a large proportion of Australians struggling with financial wellbeing. Around 46 per cent believe they are not progressing towards their financial goals1 and just as many (45 per cent) of Australians are uncomfortable with their current level of spending2.
The data also indicated more than half (56 per cent) of people would not have enough savings to handle a temporary loss of income and one in three Australian households would be unable to find $500 in an emergency3.
In response, Commonwealth Bank is introducing two new CommBank app features, Transaction Notifications and Spend Tracker, and conducting ongoing experiments with additional functionality called Savings Challenge and Savings Jar that will be available to select customers in an experimentation version of the CommBank app, called CommBank Lab apps.
These new features are aimed at improving a customer’s ability to meet their financial obligations every day, to ensure they have savings in case of a rainy day, and to help meet saving, spending or investment goals in the future.
Pete Steel, Executive General Manager of Digital, Commonwealth Bank said: “As Australia’s largest bank, we have a role to play in helping our customers achieve financial wellbeing. In a recent survey4 we found 73 per cent of Australians want banks to do more to understand their needs and concerns and 72 per cent want their bank to help them manage their finances in a rapidly changing world.
"Testing new features with customers will allow us to provide more personalised experiences, at pace, that our customers love. Customer input and feedback is incredibly important throughout the design process and we're really interested to know if these new features can help to make a real difference to our customer’s financial wellbeing.
“Additionally, we’ve been working with our behavioural economists and other industry experts to pave a path toward financial wellbeing solutions. While we will always want to deliver convenience for customers, we also want to be able to provide them with the tools they need to better manage their money,” Mr Steel said.
Currently in trial and launching in April 2017 for credit card customers, and later in the year for debit card customers:
- Transaction Notifications – real time credit card transaction notifications that give customers immediate awareness and insights into their daily spend so they can better manage their finances and improve their savings.
- Spend Tracker – a month-to-date summary of credit card activity that automatically categorises transactions and shows customers where their money is going so they can make better decisions on where to spend.
Currently being trialled in CommBank Labs app:
- Savings Challenge – a comparison of a customer’s current transaction account spending against their average for the prior three months so they can track and improve their savings over time
- Savings Jar – a transaction account experience that allows customers to set aside pots of money for unforeseen events by rounding up daily transactions. Customers will have access to their money in their transaction account whenever they need it.
“These four functions are a direct response to our customers’ concerns and uncertainties. Each product has been designed to ensure we meet a customer need – from account security, to real-time reminders of your spending habits, to helping you save money and paying your bills on time,” Mr Steel said.
For more information on the new CommBank app features visit commbank.com.au/financialtools.
1 CommBank owned research. One in three Australians consistently spent more than their income, in four consecutive months, during the last 12 months
2 Independent research company, ACA research, conducted the CommBank survey of 1,000 respondents
3 FiftyFive5 conducted a CommBank survey on a representative sample of 3,000 Australians. Statistic relative to consumers’ income
4 Based on 2.7M customer working households, where CBA are the primary banking relationship, one in three could not quickly access $500 in cash or credit, on their worst day in a given 4 month period