“Accurately verifying basic and discretionary living expenses using transactional account data is currently not feasible and in Westpac’s experience, would be of limited value" the submission reads.

The bank also says some of the regulator's suggestions to improve borrower scrutiny could in fact be damaging to the economy - which grew at a lacklustre 0.4 per cent for the March quarter - with small business bearing the brunt.

“A large and detailed list of steps, and greater document review requirements would result in increases to customer waiting times for approval, delays in the availability of credit and increased customer costs," Westpac said.

NAB gave qualified support to Westpac's position saying the issue was more complex than ASIC anticipated.

"This is not as simple as checking a customer’s declared figure against a line item in a bank statement" the bank said.

The bank said however it was only in a worst case scenario, where the regulator required every single piece of information to be verified separately, that would have a material impact on credit.


"This may increase operational costs for credit providers and, in turn, potentially impact the cost of credit for customers as well as increase assessment time for loan approvals," the bank said.

ANZ backed up its peers saying comparing and confirming expenses would be a difficult, imprecise and laborious process that was not practical.

"Based on our analysis, consideration of one average credit card statement for transactions representing actual living expenses could involve the review

of between 100-300 separate transactions for that month," ANZ said.

"We estimate that if such a review was conducted manually by a bank officer across three months statements for two accounts, it would take approximately two hours."

Commonwealth Bank also takes aim at some of the proposals with a particular emphasis on data scraping describing it as a privacy risk, one week after it apologised for losing the records of 20 million customers off the back of a truck.

“CBA has consistently expressed its concerns with tools that extract information from customers online banking platforms. CBA believes such services to be highly risky ... CBA believes the risks associated with such tools are often unknown or unclear to the customer”