But the bank's CEO Jamie McPhee has rejected the idea it was pushed into these changes by its industry super owners on the prospect of members withdrawing funds because of the COVID-19 crisis.

"This is not correct," Mr McPhee told the House of Representative economics committee hearing in Canberra on Thursday.

"(And) at no point did the bank ever remove funds from customer accounts or transfer any customer funds."

He said the bank has always been there to support its customers in times of stress, such as extending a life of a loan.

"It was in this spirit and through this lens we made a decision of adjustments to redraw limits," Mr McPhee said.

The bank was concerned some customers would fall behind their repayment schedules if they allowed them to keep redrawing on their existing terms.

"Our intent was right, our execution was wrong," he said, pointing to not giving customers advanced warning.

After getting customer feedback the bank moved quickly "to right the wrong", telling customers they could change back to their previous redraw limits.

This included taking out full page newspaper advertisements, setting up dedicated hotlines and online request systems, as well as hiring additional staff.

"We have upset our customers, we should have done better and for that we are very sorry," he said.

The hearing was part of the committee's ongoing examination of the big four banks and other financial institutions to ensure recommendations of the Hayne royal commission are implemented.

Earlier, Industry Super Australia told the hearing legislated rises in the superannuation guarantee must go ahead to ensure Australians' nest eggs are not too depleted from early withdrawals.

To ease the financial impact of the coronavirus crisis, the federal government has allowed people to withdraw up to $10,000 from their super account this financial year and a further $10,000 in the next.

"If anything, the recent downturn caused by the coronavirus pandemic just reinforces why you would want to have a guaranteed increase in super contributions," Industry Super Australia CEO Bernie Dean said.

Legislated super guarantee increases will see the current rate of 9.5 per cent grow to 10 per cent from July 2021, then a further 0.5 percentage points each year until it reaches 12 per cent in July 2025.

Mr Dean said industry super funds were not forewarned about the government's plan to allow early withdrawals as part of initiatives to help shield Australians from the economic impact of the crisis.

But he recognised "these are extraordinary circumstances".

"Unconventional decisions had to be made to provide financial lifelines to those who had lost their livelihoods overnight," he said.

He said super funds he represents have done an "amazing job" from a standing start in creating a new payment system.

That's delivered over $2.3 billion to 300,000 members, 99 per cent of which have been made within five days of receiving details from the ATO.

"I'm less happy to report that industry-wide concerns about the risks of fraud within the scheme have been realised," he said.

However processes were being put in place to minimise fraud.

Australian Associated Press