Banks to be held to a higher standard

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As of today, Australian banks will be held to a higher standard with a new code of practice that the industry says has “real teeth”.

“This is a new rule book for Australian banks,” said Australian Banking Association chief executive Anna Bligh.

“It’s a set of rules about how they treat customers, and it provides customers with rights and protections that are new.”

Every major bank will now offer low- or no-fee accounts to lower income earners, people with credits cards will be told when their low-interest rate introductory offers will run out and there will be a three-day cooling-off period offered to guarantors of home loans.

In an effort to regain the trust so many banks lost after shocking revelations during the banking royal commission, every major bank has agreed to be bound by the code, which coincides with the start of the new financial year.

There are serious consequences for banks that breach the code, which will be monitored by an independent body.

“This code has real teeth. If something goes wrong, a customer can enforce it, and there are serious consequences for those who breach it,” said Ms Bligh.

Instead of waiting for customer complaints, an independent body set up to monitor banking practices will conduct random ‘secret shopper reviews’ and will name and shame institutions doing the wrong thing, she added.

Banks and financial advisers support the new code, which will evolve to even better support customers.

“Enforceability is obviously key,” said Financial Counselling Australia chief Fiona Guthrie.

“We always think there’s things that can be done better, but that’s for the next iteration, and these documents will evolve over time.”

Ms Bligh agrees.

“There are big cultural shifts to be made,” she said.

Banks have already trained staff to meet the strict standards set by the new code. Further changes are expected in March 2020.

The code is one of many responses to the royal commission, said Federal Government frontbencher Simon Birmingham.

“We expect the banks to live up to a higher standard of conduct in the future and they will be held to account for it,” he said.

Will this new code help restore your faith in banks and other financial institutions?

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Written by Leon Della Bosca

Leon Della Bosca is a voracious reader who loves words. You'll often find him spending time in galleries, writing, designing, painting, drawing, or photographing and documenting street art. He has a publishing and graphic design background and loves movies and music, but then, who doesn’t?

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28 Comments

Total Comments: 28
  1. 0
    0

    Has anything been done to curb the multi million dollar bonuses for bank CEOs?

    • 0
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      Good point Triss, I was thinking along the same lines. It’s not as if they need to receive these huge bonuses that they have been getting for nobody knows how many years. Their ordinary remuneration is more than enough for anyone who isn’t greedy.

    • 0
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      how does a failed politician (with so many question marks over her), become the mouthpiece for a crooked network?

    • 0
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      Nah – they ‘fix’ the problem they created and cop a huge bonus for their good work in doing so… it’s only right ….

    • 0
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      daniel – that shows the close connections between ‘government’ of both parties and business… just another Old Mate’s Club ….. same as some Mining Australia sheila gets a gig as an MP….

      We vote for these people, BTW .. because unless we choose Independents all the way, we are tied to whoever any party puts up for election… and that’s always some Old Mate ….

  2. 0
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    I’d like a copy of this new code of practice so that I can have a read of the provisions that the government has put into it. It’s all very good for the government to say that they now have come up with an enforceable code of practice, but without members of the public knowing what exactly are their rights, what good is it going to do? How easy is it for a dissatisfied customer to enforce their rights?

  3. 0
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    So when are we going to see bank executives & CEO’s face criminal charges for their previous disgusting & fraudulent conduct.

    • 0
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      I’m not going to hold my breath, waiting for criminal charges to be laid, seeing that nothing has been done about them since the Royal Commission has finished.

  4. 0
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    Anna Bligh, a known crook
    remember the old saying and now an oxymoron ‘safe as a bank’ ? !!!

    • 0
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      Thought that saying was “safe as houses ” but then these days it amounts to the same thing!

    • 0
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      Daniel,boonjp, My recollection is that it was her successor who was the crook, – go something he was called? – did Anna actually have any proof brought against her other than assertions from the opposition?
      Politicians will say absolutely anything to get elected, and if you believe all the comments of politicians about other politicians, you would be justified in thinking that the whole lot of them are a bunch of sharks and liars, the which is probably very close to the truth, but imho using their propaganda about each other to justify the assertions you are making is probably slanderous, and as you have no parliamentary privilage, you could be taken for every cent you have, unless you have proof that would stand up in a Court of Law.
      If I had my way, every politician who said something detrimental about another would be immediately tested with the latest lie detector, and if found wanting would be charged with ‘attempt to defraud’ the Australian people.
      That’s the only thing that would “keep the bastards honest”.

    • 0
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      Anna Bligh was a crook, convicted or not.

  5. 0
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    I am not sure that banks have lifted their standards but one thing is for sure THEY LIFTED THE FEES FOR DEEMED CASH WITHDRAWAL TRANSACTION ON CREDIT CARDS AND NON-BANK ATM’s…..Out to get their slippery fingers into your wallet anyway they can… bastards!!!

    • 0
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      When you need a bank check to pay the tradies the bank charge 10 dollars but the bank did not have enough cash to pay the tradies, so I had to pay the tradies in small amount by cash.
      Every time you pay the treadies you need to pay 10 dollars to the bank.

    • 0
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      Magic Touch – I wanted to withdraw $4,500 cash from MY bank. They wanted to charge me $10 – which I absolutely refused. The ATM does not give this amount out, so have to go in to a bank. Why should I have to pay ANY amount to take out MY money?

    • 0
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      Had exactly that with the house removalists… wanted to pay them with a bank cheque and the staff said :- “Take the cash out!”

    • 0
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      in2sunset …I am having the same question with you.
      Why should I have to pay that 10 dollars to take out my money?

  6. 0
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    It’s all corporate jargon meaning nothing. Business will run as usual.

  7. 0
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    “name and shame?” you’re kidding surely? They have been ripping us off for years, decades even! “name and shame?”, there should be custodial sentences, heavy fines, AND naming and shaming! They have robbed us of our future, millions of us! Now we live in poverty, whilest they keep their bonuses etc….it stinks!!

  8. 0
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    Anyone noticed how banks have put their tellers out in the open and they are no longer behind bulletproof glass!

    All well and good until you want to change coins to notes and the tellers refuse because it is deemed a ‘safety issue’. Hmmm you say, an amount of say $200 ready counted and bagged is a safety issue yet you can rock up to the same counter and withdraw many times that amount on cash with no such concern.
    Basic banking functions no longer available abd apparently that is serving the customer better!

  9. 0
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    Trust banks? Hell will freeze over before THAT ever happens.

  10. 0
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    Code of practice? – what a joke! I recently made some inquiries to my bank about an investment house loan. They said they would get back to me. 3 weeks later I received a letter saying that ‘as we have made numerous attempts to contact you without success….’ and literally calling in the loan because I had refused contact! When I rang them, I asked for proof of any attempts they had made to contact me. Surely this would be noted on any file I had. But no, they couldn’t find anything – NO dates/times of any attempts to ring (my mobile phone also showed no unidentified calls). Left a very sour taste in my mouth.
    Have now sold the house…

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