The Australian Securities and Investments Commission (ASIC) has approved the first stage of a tough new code of practice for Australia’s banks, ensuring they will no longer charge dead people for services they didn’t provide and ensure lending on credit cards is more responsible.
The first stage, which came into force yesterday (1 July), puts banks on notice that they must be responsible when it comes to placing limits on what customers can borrow on credit cards.
ASIC said the new code will apply to all members of the Australian Banking Association and the relevant protections in the Code will form part of the banks’ contractual relationships with their banking customers.
ASIC now moves on to the code’s second stage which addresses recommendations of the Royal Commission intoMisconduct in the Banking, Superannuation and Financial Services Industry dealing with products and services for vulnerable customers.
This stage, to come into effect on 1 March 2020, will also address stakeholder feedback relating to various small business protections.
In a statement, ASIC said it would aim to decide on the details of the proposed changes later in 2019.
“Our decision will follow engagement with key stakeholders to ensure that the revised code provides an appropriate level of commitment by banks to consumer and small business protections,” ASIC said.