The revised Code of Banking Practice has been published.
Subscribing banks have 12 months to make changes to ensure
compliance with the revised Code by 1 February 2014.
The key changes to the Code include:
Provisions for customers in remote Indigenous
communities: Clause 8
Banks must take reasonable steps to:
make information about relevant banking services available in
an accessible manner
provide details of accounts that may be suitable
assist customers to meet identification requirements
appropriately train staff to be culturally aware
consider government programs that may be relevant in providing
banking services to remote indigenous communities.
Reminder to mortgagee about insurance obligations:
Customers with a mortgage on a primary place of residence or
residential investment property are required to be sent an annual
reminder regarding their insurance obligations.
Account suitability: Clause 16.3
Banks must provide information about accounts with low standard
fees and charges to an existing or prospective client if, in the
course of dealing, the bank becomes aware that they are the holder
Commonwealth Seniors Health Card
Health Care Card
Pensioner Concession Card.
Written notice to small business: Clause
Small business customers are required to be given 10 business
days' written notice of materially adverse changes to the terms
of their credit facility. Note: If the change also applies to the facilities
of other small businesses, notice is not required. Also a shorter
notice period may be required to avoid or reduce an increase in the
bank's credit risk.
Provision of information regarding chargeback rights:
Banks must clarify the existence of chargeback rights for
disputed transactions on relevant debit cards, including debits
under recurrent payment arrangements.
Expansion of financial hardship provisions: Clause
Banks must commit to:
dealing with an authorised financial counsellor or
representative on request
providing a written response, with reasons, to a request for
including information about processes for dealing with
financial difficulty (including contact numbers) on bank
Definition of commercial asset financing guarantor:
The definition of a commercial asset financing guarantor has
been widened. Some guarantors will no longer get the full benefit
of the Code provisions.
Debt collection provisions: Clause 32
comply with the ACCC and ASIC Debt Collection Guidelines
only sell debts to third parties who agree to comply with the
Debt Collection Guidelines
not assign a debt when a bank is actively considering whether a
customer is in financial difficulty or while a debtor is complying
with an arrangement which has been agreed upon in relation to the
Restriction of powers of the Code Compliance Monitoring
Committee (CCMC): Clause 36(b)
The CCMC will no longer be able to investigate or report
breaches of a key commitment and a general obligation to comply
with relevant laws, unless those breaches are also breaches of
another provision of the Code.
In the years following the global financial crisis of 2008 many Australian investors lost their life savings as financial products failed and the Australian Stock Exchange shed over 3,000 points.
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