Save
Does the new banking code go far enough?
The new banking code of practice released by the Australian Bankers’ Association on Wednesday is purportedly a “huge step”, but some think it doesn’t go far enough.
Does the new banking code go far enough?
The new banking code of practice released by the Australian Bankers’ Association on Wednesday is purportedly a “huge step”, but some think it doesn’t go far enough.
Speaking yesterday, ABA chief executive Anna Bligh said the code is proof that “banks are committed to change”.
“The new code is stronger, broader and written in simple to understand language. It has been completely rewritten to better meet community expectations and service the needs of customers,” she said.
The revised code means customers will be informed about transaction service fees immediately before they incur the fee and will be able to receive a list of the direct debits and recurring payments they’re making on their accounts “on request”.
Banks will also waive or refund fees to customers who have not had access to electronic statements.
“This new set of rules and behaviours will go a long way in addressing the expectations that Australians have of their banks,” Ms Bligh said.
“Banks most certainly do not underestimate the challenge ahead of them and will continue to make the necessary changes and improvements that their customers expect.”
However, RateCity money editor Sally Tindall argued that while the code was a good start, there was still more to be done.
She said, “It’s by no means pens down for the banks.
“Giving customers the right to cancel their credit card online is a significant win. Currently, 100 per cent of cards can be opened online, yet just 10 per cent of cards can be closed the same way. This is unfair for customers who don’t want to be put through the wringer by a call centre retention team.”
Ms Tindall welcomed the revised approach to fee notifications, saying “there’s nothing more annoying than getting hit by a fee you didn’t even see coming”.
Continuing, she said notifying customers about the upcoming expirations of interest-free periods will be another change that could help customers “side-step unnecessary interest charges”.
“While there are a number of victories in today’s announcement, it is disappointing they didn’t go further,” Ms Tindall said.
“We would like to see the banks increase the minimum repayment on credit cards to 10 per cent, to see customers clear their debt faster,” she continued, noting that only two cards allow this.
“We’d also like to see all banks that offer credit cards include a low rate option for their customers.”
The changes punctuate a difficult year for Australian banks and comes mere weeks after the government’s announcement that it will establish a royal commission into banks and financial services.
Announced in late November, the commission will examine the banking, superannuation and financial services industries.
Speaking that day, but prior to the announcement, Ms Bligh said “diminishing” trust in the banking sector was a global problem.
She said, “Recent work that the ABA has done has shown that Australians trust the financial sector with their money and their privacy of their data much more keenly than they do trust any government agency, so there are high levels of trust on some things.
“Where the trust is breaking down is on the confidence that consumers have on whether or not corporations are getting the balance right on the interests of the customer and the protection of the customer versus the interests of shareholders and profit. I think it’s important to understand where the breakdown is.”
RELATED ARTICLES
Savings account
Protecting your savings from inflation in Australia
Inflation is an economic phenomenon that erodes the purchasing power of money over time, directly impacting the real value of your savings. In Australia, as in many parts of the world, periodic rises ...Read more
Savings account
Maximising your savings effortlessly: The power of automation in Australia
In the fast-paced world we live in, managing finances can often become an overlooked aspect of our daily routines. However, the advent of technology has introduced a seamless solution to this ...Read more
Savings account
Maximising your savings account: What you need to know
Saving money is a fundamental aspect of financial security and wellbeing. Read more
Savings account
Are ‘nudges’ the secret ingredient to financial wellness?
Are better financial habits a simple reminder away? Read more
Savings account
Afterpay launches Money app, bank accounts and retroactive BNPL
Afterpay is upgrading its app-based arsenal. Read more
Savings account
2020 saw the fastest increase in bank deposits since the GFC
Bank deposits of Australian households increased by more than 12 per cent last year. Read more
Savings account
Australians are putting savings goals ahead of holiday plans
While travel restrictions are soon set to ease, Australians are still putting their savings goals first. Read more
Savings account
More than half of Aussie Millennials don’t have a savings plan
Money is remaining a taboo subject for Millennials, which is leading to poor saving habits, a big four bank has revealed. Read more
Savings account
Protecting your savings from inflation in Australia
Inflation is an economic phenomenon that erodes the purchasing power of money over time, directly impacting the real value of your savings. In Australia, as in many parts of the world, periodic rises ...Read more
Savings account
Maximising your savings effortlessly: The power of automation in Australia
In the fast-paced world we live in, managing finances can often become an overlooked aspect of our daily routines. However, the advent of technology has introduced a seamless solution to this ...Read more
Savings account
Maximising your savings account: What you need to know
Saving money is a fundamental aspect of financial security and wellbeing. Read more
Savings account
Are ‘nudges’ the secret ingredient to financial wellness?
Are better financial habits a simple reminder away? Read more
Savings account
Afterpay launches Money app, bank accounts and retroactive BNPL
Afterpay is upgrading its app-based arsenal. Read more
Savings account
2020 saw the fastest increase in bank deposits since the GFC
Bank deposits of Australian households increased by more than 12 per cent last year. Read more
Savings account
Australians are putting savings goals ahead of holiday plans
While travel restrictions are soon set to ease, Australians are still putting their savings goals first. Read more
Savings account
More than half of Aussie Millennials don’t have a savings plan
Money is remaining a taboo subject for Millennials, which is leading to poor saving habits, a big four bank has revealed. Read more
More articles
OUR PLATFORMS AND BRANDS
- Accountants Daily
- Accounting Times
- Adviser Innovation
- Australian Aviation
- Broker Daily
- Cyber Daily
- Defence Connect
- Fintech Business
- HR Leader
- Independent Financial Adviser
- Investment Centre
- Investor Daily
- Lawyers Weekly
- Money Management
- Nestegg
- Property Buzz
- Real Estate Business
- Smart Property Investment
- SMSF Adviser
- Space Connect
- Super Review
- The Adviser
- Wellness Daily
- World of Aviation
EVENTS AND SUMMITS
- ACE25 The Accounting Conference and Exhibition
- Adviser Innovation Summit
- Australian Accounting Awards
- Australian AI Awards
- Australian Aviation Awards
- Australian Aviation Summit
- Australian Broking Awards
- Australian Cyber Awards
- Australian Cyber Summit
- Australian Defence Industry Awards
- Australian Law Awards
- Australian Law Forum
- Australian Space Awards
- Australian Space Summit
- Australian Wealth Management Awards
- Australian Wealth Management Summit
- Better Business Awards
- Better Business Summit
- Broker Innovation Awards
- Broker Innovation Summit
- Budget Summit
- Commerical Finance Awards
- Corporate Counsel Summit
- Defence & National Security Workforce Awards
- Fund Manager of the Year Awards
- ifa Excellence Awards
- Lawyers Weekly 30 Under 30 Awards
- New Broker Academy
- Partner of the Year Awards
- Partner Summit
- REB Awards
- Rising Star Awards
- SME Bootcamp
- SMSF Technical Strategy Day
- Super Fund of the Year Awards
- Women in Finance Awards
- Women in Finance Summit
- Women in Law Awards
- Women in Law Forum
LEARNING AND EDUCATION
MOMENTUM MARKETS NETWORK
LINKS
STAY CONNECTED
Make your nest egg grow. Register now for nestegg updates.