It’s just one of the changes that was originally recommended by commissioner Hayne in his final report for the banking royal commission.
The 2020 Banking Code of Practice now also prevents default interest from being applied to agricultural loans while farms are affected by drought or natural disaster, and aims to ensure services to people with limited English as well as those living in remote areas are inclusive and accessible.
Guaranteed features for basic bank accounts have also been flagged for their inclusion in the Code.
Commenting on the changes, ABA CEO Anna Bligh considered that “the banking industry has been working hard to implement the recommendations of commissioner Hayne’s final report, which included important changes to the Banking Code of Practice”.
The changes “will form part of the promises made to customers through the industry’s Banking Code of Practice”, Ms Bligh flagged.
She stated that the Code changes are in addition to a number of actions already taken by banks as a direct result of the royal commission, including the end to fees for no service and a remediation bill topping $5.8 billion.
The changes to the code come as consumer advocacy groups have praised 24 potential pieces of legislation that would ensure “the financial wellbeing of customers is truly prioritised” in the financial services sector.
