“Banks charged mortgage holders $55m in extra interest after offset account errors, Asic finds”

What actually happened

ASIC reviewed more than 200,000 home loans across eight banks and found lenders had repaid $55m to affected customers over two years for offset account errors, chiefly accounts that were never properly linked to the mortgage, meaning customers paid interest on the full loan balance instead of the offset-reduced amount. ASIC chair Sarah Court said some banks "are not getting the basics right" and warned the remediation figure would rise. The Australian Banking Association's Simon Birmingham countered that the findings meant "in more than 99% of cases banks were found to manage them correctly."

Key facts

• $55m repaid to customers over two years across the eight banks reviewed, per ASIC's report.
• ASIC's sample: 204,000 home loans reviewed; issues found in "hundreds" of offset accounts, not hundreds of thousands.
• One case cited: a customer paid over $3,500 in extra interest in a single month after their offset was accidentally unlinked.
• Offset account balances nationally have grown to near $350bn, per the article; a similar 2025 ASIC surveillance announcement had cited the market at roughly $307bn.
• ASIC found some banks couldn't readily confirm whether a customer even had an offset account, which the regulator says means the true scale could be larger than the $55m figure captures.

What to watch for

Watch whether ASIC's remediation total climbs as it warned, since $55m is explicitly described as a floor, not a final figure. Also worth tracking: this isn't a first offence, the Federal Court in 2022 ordered ANZ to pay $25 million for failing to provide certain offset account benefits it had agreed to give customers, so the next test is whether ASIC names individual banks or pursues enforcement rather than industry-wide remediation.