An Independent Review of the Code of Banking Practice was completed in February 2017, which measured how banks’ standards of conduct are meeting current community expectations. This relates to banks’ dealings with customers including homeowners, small businesses and farmers.
Led by former ASIC Executive General Manager and governance expert Mr Phil Khoury, the review examined how banks:
- Offer products and services to customers
- Disclose fees and charges
- Handle complaints, and
- Look after borrowers in financial difficulty.
As a result, significant changes will be made to the Code to raise standards in banking and deliver on the industry’s commitment to make banking better.
Some of the changes customers can expect in a new Code include:
- Plain-English language so that Australians can better understand their banking rights and responsibilities.
- An easier way to cancel credit cards or reduce the credit limit.
- A new dedicated section for small businesses, and a commitment by banks to simplify terms and conditions and give more notice when loan contracts change.
- Increased help for people experiencing, or at risk of, financial difficulty, so they can take control of their finances.
Of the 99 recommendations, the banking industry supports 61 in full. We need to work through with stakeholders some of the recommendations, including those which are subject to current Federal Government reviews.
The new Code is currently being redrafted in plain English so it is easier to read and customers can better understand banks’ commitments to them, as well as their responsibilities. It will be published by the end of 2017.
More information on the independent review of the Code of Banking Practice, and a copy of Mr Khoury’s report, is available on the Review’s website. Answers to frequently asked questions about the Code are available here.
Mr Ian McPhee is independently overseeing this initiative as part of the governance of industry reforms announced in April 2016.