The National Australia Bank has moved to settle a multi-million dollar class action, which consumer groups say could pressure rivals and other industries to drop penalty fees for good.

NAB and law firm Maurice Blackburn lodged an application in the Federal Court on Friday to open and close the class action, signalling that they are working to settle the matter.

The bank on Wednesday described the move as “a first but significant step” towards a potential settlement, which could be up to $40 million to about 30,000 customers.

• NAB slugged for misleading ads
• How to tell if you’re management material
• How Google search results can ruin your career

“NAB is doing this because we believe this is the right thing to do for our customers and our business,” chief executive Andrew Thorburn said in a statement.

The move has been welcomed by consumer watchdog CHOICE, which has been campaigning for an end to excessive bank fees since 2007.

CHOICE spokesperson Tom Godfrey said in a statement it was “not often we see a bank take a leadership position and genuinely act in the interests of customers”.

CHOICE has long campaigned for a better deal for consumers when it comes to late payment fees, which should be an accurate reflection of the costs faced by businesses when customers are unable to make payments on time,” Mr Godfrey said.

“It’s not the role of business to punish customers. We expect to see late payment fees to come down in other sectors, such as telecommunications, as a result of this decision.”

The class action is one of a string of legal actions undertaken by Maurice Blackburn against Australian banks, including ANZ, Westpac and the Commonwealth Bank, over unfair fees.

Earlier in 2014, the Federal Court ruled ANZ had illegally imposed penalties for late payments on credit cards.

Those charges – made when a customer missed a minimum credit bill payment – were either $20 or $35, representing a mark-up of up to 7,000 per cent on actual costs of as low as 50 cents.