RIP Commonwealth Bank Dollarmites

RIP Commonwealth Bank Dollarmites
Image: Commonwealth Bank

The Commonwealth Bank of Australia for years secured troves of customers by recruiting school kids onto its ‘Dollarmites’ banking platform. But this practice is no longer, with the yellow bank this week announcing Dollarmites was dead.

Under the Dollarmites scheme, primary-aged students and their parents were encouraged to open savings accounts through Commonwealth Bank, where they could deposit any loose change and pocket money not spent on canteen snacks. The bank held firm this was an educational tool, allowing young Aussies to learn the benefits of saving. In a statement made last December, the bank said 80 per cent of parents with a child in its program find it valuable.

But the country’s financial services regulator reckons school outreach schemes like Dollarmites were “unable to demonstrate that these programs in and of themselves improve savings behaviour”.

ASIC said young children represent “vulnerable consumers”. It also said the banks “fail to effectively disclose that a strategic objective of these programs is customer acquisition”.

With Victoria, the ACT and Queensland governments already putting a block on such customer recruitment activities, NSW has followed suit. So this week, Commonwealth Bank announced it was shuttering the Dollarmites program.

“For 90 years, the Commonwealth Bank has been supporting the financial wellbeing of young Australians and we are committed to continuing to provide the programs and services they need,” said Angus Sullivan, Group Executive Retail Banking Services.

“Support from schools, parents and teachers for our School Banking program is strong, with over 1,450 schools around the country who choose to run our program. We are disappointed with the position taken by the Australian Securities and Investments Commission (ASIC) and subsequent decisions by some state and territory governments to take that choice away from individual schools and parents.”

It’s moved the customer recruitment drive, I mean ‘youth education’, online.