CUA unveils Financial Assistance Package to support members affected by COVID-19
Australia’s largest member-owned banking organisation, CUA, has announced a Financial Assistance Package to help support its members impacted by the COVID-19 situation.
CEO Paul Lewis said CUA has listened to the concerns of its members over the past week and has prioritised measures that will help provide immediate relief to those most impacted.
Among the changes, CUA announced interest rate relief for home-owners with new 2-year and 3-year fixed home loan rates of 2.29% p.a. (comparison rates* of 4.11% p.a. and 3.94% p.a. respectively) on offer for owner occupiers paying principal and interest – a reduction of at least 0.55% p.a. The rates will be available for new lending and loan switches from 1 April 2020.
Members will also have an option to defer repayments on mortgages and business loans for up to six months1 if they are experiencing difficulty as a result of COVID-19. They can also extend their loan term by the same length of time to ease the pressure when repayments resume in the future.
CUA will lift its 12-month term deposit rates by 0.30% p.a. to a market-leading special offer of 2.00% p.a. and for members aged 55+ to 2.10% p.a., available for a limited time to help those living on fixed incomes including retirees. Meanwhile, CUA Health private health insurance policy-holders will be able to suspend their policy and premium payments for three months if their income is reduced as a result of COVID-19.
“We are seeing a significant increase in members contacting us for support, including those whose job or income has been affected, as the nation continues its efforts to contain the spread of coronavirus,” Mr Lewis said.
“As a member-owned organisation, we have supported our members and communities for more than 70 years and it’s what we will continue to do as we face this challenge. We will be here to help members get through this period of uncertainty and get back on their feet.”
Mr Lewis said CUA had strived to support the diverse needs of its 560,000 strong member base.
“Our COVID-19 Financial Assistance Package contains relief for members with home loans, small businesses, deposits, personal loans and health insurance,” he said.
“Members with variable home loans have also received a 0.25% p.a. interest rate reduction this week, following the RBA decision at the beginning of March, providing them with relief with one of the most competitive rates in market.
“This is an unprecedented situation and we are doing our best to provide much-needed relief, prioritising the assistance we know our members urgently need right now.”
The CUA Financial Assistance Package will include:
Support for members with home loans
- Reduction to fixed home loan rates: New 2.29% p.a. 2-year and 3-year fixed home loan rates (comparison rates* of 4.11% p.a. and 3.94% p.a. respectively) for owner-occupiers making principal and interest repayments, effective Wednesday 1 April 2020 – a reduction of at least 0.55% p.a. These rates are available for new or existing members.
- Repayment relief for members with home loans: You can defer your home loan repayments for up to six months if you are experiencing difficulty as a result of COVID-19. We can also extend your loan term by the same length of time to ease the pressure and minimise the increase to your repayments when you start to make them again. To apply online in just a few minutes, visit www.cua.com.au/tools-and-services/support/financial-assistance
- You can access fee free redraw and offset if you have a variable or fixed rate loan with these features.
- We’re offering the flexibility to shift from Principal and Interest payments to Interest Only for eligible members. (Note a change of interest rate will apply).
- If you’re paying more than the minimum repayment each month, you can request to reduce this to the minimum payment amount, freeing up extra cash flow.
- We don’t charge annual package fees or account keeping fees on our home loan products and will waive any late payment fees on home loan payments.
Support for members with deposits
- We’ve increased our 12-month Term Deposit rate by 0.30% p.a., launching a special offer of 2.00% p.a. interest rate for all Australians and a 2.10% rate for members aged over 55 years. These rates are effective for a limited time from Wednesday 25 March 2020. Note that Term Deposit rates are subject to change – for the latest rates click here.
- CUA does not charge account keeping fees on deposit products.
Support for members with personal loans or credit cards
- We will waive late fees for personal loan repayments. Other assistance options may also be available for members on request.
- Repayment relief for credit cards is available on a case by case basis, with no fees for replacement cards.
Support for members with CUA Health insurance
- CUA Health will delay its 1 April premium changes for six months until 1 October 2020. Members do not need to do anything to take advantage of the delay to premium increases, as the change will be applied automatically. (Note that if members have been advised of other changes to their policy or level of cover, these changes will proceed on 1 April 2020 as planned.)
- CUA Health policy-holders experiencing financial difficulty or a loss of income as a result of COVID-19 can suspend your policy and premium payments for three months by phoning CUA Health on 1300 499 260. If you require hospital treatment during the period of the suspension, you should contact CUA Health and we will work with you to reactivate your policy.
- For the duration of the COVID-19 pandemic, CUA Health will cover members for all in-hospital COVID-19 treatment irrespective of their level of hospital cover, provided they have held the CUA Health hospital policy for at least two months.
- For policy-holders with Extras cover, CUA Health will pay benefits for phone or video consultations provided by a range of allied health practitioners until 30 September 2020. This applies to services for psychology, speech pathology, dietetic advice (including nutritionists), physiotherapy, occupational therapy, exercise physiology and podiatry. These benefits will be available where the member’s Extras policy already covered this type of service, provided the member has served any applicable waiting period.
Support for small business
- Repayment relief for small business members: You can defer your business loan repayments for up to six months if you are experiencing financial difficulty as a result of COVID-19. We can also extend your loan term by the same length of time to ease the pressure and minimise the increase to your repayments when you start to make them again. To apply online in just a few minutes, visit www.cua.com.au/tools-and-services/support/financial-assistance
- We’re reducing secured overdraft rates by 2.00% p.a. for small business members.
- We’re reducing variable rates on term loans for existing small business members from Wednesday 8 April 2020:
- We’re reducing the rate for term loans with residential security to a new variable rate of 4.39% p.a.
- We’re reducing the rate for term loans with commercial security to a new variable rate of 4.89% p.a.
CUA will continue to keep members updated on services, and the support available, at www.cua.com.au/coronavirus-info.
* Comparison rate calculated on a $150,000 loan over 25 years based on monthly repayments. WARNING: Comparison rate true only for example given and may not include all fees and charges. Different terms, fees or other loan amounts might result in different comparison rate.
1. If members choose to defer their loan repayments, they will continue to incur interest which will be added to the outstanding loan amount. When the repayments resume, they will be higher, to ensure the outstanding balance is paid over the remaining term of the loan.