'Do your homework,' banks tell PM

Australia's banks have told Prime Minister Kevin Rudd to 'do his homework' before he criticises them for gouging customers on fees.

Rudd said banks had overcharged in the past in response to a report showing they had collectively made AU$12.7 billion in fees from customers last financial year, up nine per cent on the previous 12 months.

The Australian Bankers' Association immediately accused the PM of barking up the wrong tree.

Chief executive Seven Munchenberg agrees the fee revenue figures look big but argues that is because billions of transactions flow through the banking system each year.

He says households paid on average just 13 cents a week more in fees last financial year, an increase of one per cent.

IMF leads class action

Litigation funder IMF Australia says 112,700 bank customers have so far joined its planned class action to recoup unfair bank fees, but says that number is "only scratching the surface".

"We have had a good sign up to the class actions so far, but are still only scratching at the surface of the numbers affected by these unfair charges," said James Middlewick, managing director of IMF subsidiary Financial Redress.

"I can only urge as many people as possible to keep joining up."

IMF made the statement on Thursday after a Reserve Bank of Australia (RBA) report showed Australian banks collectively made $12.7 billion in fee income from their customers last financial year.

IMF said in a statement it planned to launch the class action in six to eight weeks.

IMF and law firm Maurice Blackburn are targeting 10 domestic and two global banks for charging what they claim are excessive punitive fees on transaction and credit card accounts, from 2004.

The case will focus on honour, dishonour, over-limit and late payment fees.

Maurice Blackburn claims they were punitive charges as they were much higher than the actual cost to the bank for a breach of contract on the accounts.