BSB 805 050

To give you the best possible experience, this site uses cookies. Learn more about cookies.

BSB 805 050

Bank multi-branding is a trick

Media release

20 Aug2014

A consumer survey of more than 1,500 people undertaken by People’s Choice Credit Union has found most Australians believe multi-branding is a trick used by banks to hide their ownership.

Furthermore, 84% of respondents believed banks should have to disclose who owns them when they advertise. Under current regulations banks can bury this disclosure in fine print.

“People want the information but banks are trying to keep it quiet – that’s why we’re encouraging everyone to ask the question ‘who owns you?’” said Peter Evers, Managing Director of People’s Choice.

The survey found some two-thirds of people thought multi-branding was used to trick customers about ownership, while only 30% of people saw it as fair.

Multi-branding occurs when banks market similar and competing products under the different sub-brands that they own, many of which look like regional banks or non-banks. For example, Westpac owns BankSA, St George, Bank of Melbourne and RAMS. Commonwealth Bank owns BankWest and part-owns Aussie.

“We need to change this, and this clear consumer sentiment makes the argument for change even stronger,” Mr Evers said.

Banks should disclose in their advertising when they are owned by another bank  84.3%
 Allowing some banks to use multiple brands is intended to trick customers into thinking the bank is ‘local’  64.6%
 Having multiple bank brands is about restricting customer choice of  providers   40.8%

"Multi-branding is simply unfair because it creates artificial competition. The fact is, many of the smaller financial institutions out there are owned by the Big Four, which are trying to hide that ownership.

“They want people to think these smaller, often regional institutions are independent – but they are not – and people need to know that so they can make an informed decision.”

Prominent and clear disclosure

People’s Choice believes a fair solution is easy. In any advertising, financial institutions would have to declare their ultimate ownership prominently and clearly.

“For example, just clearly brand the ads with ‘Part of the Westpac Group’ and that logo or similar. That open disclosure is crucial. If people don’t care, so be it, but they have the right to know so they can make an informed decision,” Mr Evers said.

This call for greater disclosure is supported by COBA, the Customer Owned Banking Association, which represents credit unions, building societies and mutual banks. 

“If you believe in fair play, if you believe in a genuinely competitive market with real choice, consumers need to be able to easily understand the true identity and regulatory status of the entity they’re dealing with,” Mr Evers said.

“Major banks hide behind sub-brands that look like regional banks or non-banks. Consumers need real choice through clearer and more effective disclosure.”

The People’s Choice survey involved 1,520 people and was conducted by the Ehrenberg-Bass Marketing Institute.

Bank ads: confusing, misleading, indecipherable

In a result released earlier, the same survey found most Australians believe bank advertisements are not only confusing, they are actively misleading.

70.4% of respondents thought bank advertisements were ‘confusing’ and 64.7% believed they were ‘misleading’. Only a third of the people (33.1%) thought they were ‘honest’ with just 26.4% saying they were ‘clear’.

Refer to the infographic to the right for more information. 

We'd like to use your current location

For a more personalised experience please enter your location below...


Change your location