Australian Banking Association Banking Code of Practice
Setting the standards of practice for banks, their staff and their representatives
1 March 2020 Release The Australian Banking Our role Association has the in society active participation Australia’s banks play an important role in contributing to the prosperity of the nation’s of member banks economy, for the benefit of all Australians. in Australia Our customers count on us to We are committed to continuously provide them with a safe place to improving and being accountable. deposit money, to offer a wide range of options to access banking and In fulfilling these responsibilities, financial services, and to help we will continue to contribute to businesses start and grow. the stability, strength and prosperity of Australia’s financial system and We understand that trust is critical society. To do this, we will look to to our relationships with customers continually improve our banking and that for us to earn that trust, services and how we engage with we need to do the right thing. our customers and communities.
We acknowledge that our The Banking Code of Practice Australian Banking Association: responsibilities to customers, (the Code) is one of the ways investors, employees and the we strive to achieve these goals. broader community must be Post PO Box H218, Australia Square NSW 1215 carefully balanced. Telephone 02 8298 0417 Web ausbanking.org.au Customers, investors, employees and communities expect our Banking Code of Practice behaviour to meet high ethical Published 12 December 2019 standards, backed up by the right internal culture and practices.
1 The new Banking Code of Practice sets a new standard of customer service for Australia’s banks.
The new Code is part of a significant reform agenda to improve banking services to better meet community standards and expectations.
Australians, along with businesses large and small, entrust their financial security and wellbeing to one or more of the banks who are signatory to this Code.
In signing this important document, these banks make a commitment to you, their customers, to ethical behaviour, to fair and responsible lending practices and to the protection of your privacy.
In a world where technology is rapidly changing the banking experience, making it more convenient, more mobile and more transparent than ever before, strong, ethical banks remain critical to customer trust and confidence.
With this new Banking Code of Practice, banks take on a stronger responsibility to deliver on that expectation.
In addition to a community and industry wide expectation, the high standards of behaviour and service set out in this Code are enforceable rights for customers.
In an Australian first, this new Banking Code of Practice has been considered and approved by the Australian Securities and Investments Commission under their industry code approval powers.
I look forward to the Banking Code of Practice improving the banking experience for all customers.
Anna Bligh
Chief Executive Officer Australian Banking Association
2 3 1. Trust and confidence
What is the The Code is • We are committed to earning and retaining the trust of our customers and the community.
Banking Code underpinned • We are committed to making promises and keeping them to deliver good of Practice? by our customer and community outcomes. • We will comply with all laws relating to banking services. Statement • We will protect your privacy. • We recognise our role in society and of Guiding our impact on the wider community. 2. Integrity The Banking Code of Practice (the Code) sets out the standards Principles • We will act honestly and with integrity. of practice and service in the Australian banking industry for • We will be fair and responsible in our individual and small business customers, and their guarantors. These principles — shared by dealings with you. This version of the Code takes effect from 1 March 2020. all member banks — provide • We will build and sustain a culture based on strong ethical foundations. an ethical, customer-oriented The Code provides safeguards and Over time, many of the standards and sustainable framework. They protections not set out in the law. embedded in the Code have been guide us in our decision-making 3. Service It complements the law and, in included in the law. when performing our work and • We will deliver high customer service some areas, sets higher standards and standards. than the law. By promoting best practice, the Code serving our customers. has led to higher standards in the • We will ensure banking services are The Code was first introduced in 1993. banking and financial services accessible, inclusive and provided Since then, it has undergone multiple industry. to you in a fair and ethical manner. improvements — responding to • We will raise awareness of the basic emerging issues and the changing (low, or no fee) banking products that needs of our customers — to ensure we may offer. it remains relevant. • We will take a responsible approach This version of the Code has been to lending. developed in close consultation with • We will work to help you if you are key stakeholders including consumer experiencing financial difficulty. groups, government, regulators and the banking industry. It replaces the previous version, Release 1 of the 4. Transparency and accountability Banking Code of Practice 2019. • We will communicate with you in a clear and timely manner.
• We will be accountable in our dealings with you.
• We will be transparent in our communications with you.
4 5 Australian Banking Association Banking Code of Practice
Setting standards of conduct for banks, their staff and their representatives.
Each bank that has adopted the Code will comply by the transition date.
It is a condition of ABA membership that member banks with a retail presence in Australia are required to sign up to the Code. Banks that have adopted the Code are listed on the ABA website: ausbanking.org.au/code
6 7 COVID-19 SPECIAL NOTE COVID-19 has changed the way we live, work and conduct business
Added to The Banking Code in June 2020
This Special Note is part of the Banking Code These extraordinary circumstances may affect of Practice (1 March 2020 Release) and our internal resources and capacity, and the applies in relation to the coronavirus known types of problems confronting our customers. as COVID-19. Consequently, the effects of COVID-19 may This Special Note commences on 1 July 2020 mean we are unable to fully comply with and applies until 1 September 2021 in relation strict timing requirements for notices and to banking services and guarantees during communications under the Code. that time. While this special note applies, where we do COVID-19 has changed the way we live, work not meet, but have made good faith efforts to and conduct business. It continues to have a comply with, the timing requirements in significant impact on the Australian economy. following paragraphs, we do not breach the The financial sector has a key role to play in Code: 101(b)&(c), 102, 148, 164, 205, and 206. supporting our customers and helping build a The substantive obligations in those bridge to recovery. paragraphs, along with all other requirements in other parts of this Code, continue to apply Like the key Government and regulatory as usual. agencies, the banking industry acknowledges the importance of the continued flow of credit During the period for which this Special Note to affected customers and industries in the operates: current environment. 1. On acknowledging your complaint, we We note that the Council of Financial will advise you of the possibility of delays to Regulators, which includes the Australian the usual required notifications during the Treasury, The Reserve Bank of Australia, the complaints process. Australian Securities and Investments Commission (ASIC), and the Australian 2. Despite anything in this Special Note, we Prudential Regulation Authority (APRA), have will inform you, within 45 days of your committed to take account of the complaint (or such other time as specified for circumstances in which lenders are currently the relevant dispute in ASIC’s Regulatory operating when administering their respective Guide 165), of your rights to apply for external laws and regulations. dispute resolution if we have not resolved your complaint. Other agencies with an important role in enforcing this Code, such as the Australian The effects of COVID-19 may also be relevant Financial Complaints Authority (AFCA), and to our obligations under the Code when the Banking Code Compliance Committee considering providing new or increased loans (BCCC), have issued similar statements to your small business. recognising the effect of COVID-19 on the These effects include the inherent difficulties in industry. making predictions for matters such as the In this environment, and in keeping with the pace of economic recovery, and in assessing commitments made by the agencies outlined your ability to service such loans. above, it is important that banks have regard In these circumstances, our obligation to to both their obligations under this Code and engage with you in a fair, reasonable and the broader critical need to preserve and ethical manner, and to exercise the care and restore the functioning of the economy when skill of a diligent and prudent banker, will making decisions on the provision of banking necessarily be informed by these matters and services during this period. the effects of COVID-19 generally. Table of contents
Chapter Page Chapter Page
Part 1 How the Code works 10 Part 7 Guaranteeing a loan 32 1. Who the Code applies to 11 25. Limiting liability under the guarantee 33 2. Publication and review of the Code 13 26. What we will tell and give you 33 27. Signing your guarantee 35 Part 2 Your banking relationship 14 28. Withdrawing or ending your guarantee 35 3. Our compliance with this Code 15 29. Enforcing our rights under the guarantee 36 4. Trained and competent staff 15 5. Protecting confidentiality 15 Part 8 Managing your account 38 6. Compliance with laws 15 30. Keeping your accounts safe and secure 39 7. Closing a branch 15 31. Statements we will send you 39 32. Cost of transaction service fees 39 Part 3 Opening an account and using our banking services 16 33. Managing a credit card or debit card 40 8. Providing you with information 17 34. Direct debits and recurring payments 41 9. Communication between us and you 17 35. Joint Accounts 41 10. Responding to your request for information 17 36. Closing any of your banking services 41 11. What information we will give you 17 37. Your right to copies of certain documents 42 12. Acquiring a new product or service 19 38. When we change our arrangements with you 43
Part 4 Inclusive and accessible banking 20 Part 9 When things go wrong 44 13. Being inclusive and accessible 21 39. Contact us if you are experiencing financial difficulty 45 14. Taking extra care with customers who may be vulnerable 22 40. We may contact you if you are experiencing financial difficulty 46 15. Banking services for people with a low income 22 41. We will try to help you if you are experiencing financial difficulty 46 16. Basic accounts or low or no fee accounts 23 42. When you are in default 48 43. When we are recovering a debt 48 Part 5 When you apply for a loan 24 44. Combining your accounts 49 17. A responsible approach to lending 25 45. Helping with deceased estates 50 18. Our approach to selling consumer credit insurance (CCI) 26 19. Lenders mortgage insurance 27 Part 10 Resolving your complaint 52 46. Our Customer Advocate 53 Part 6 Lending to small business 28 47. If you have a complaint about us 53 20. Helping a small business when it applies for a loan 29 48. How we handle your complaint 53 21. When will we not enforce a loan against a small business? 29 49. Code monitoring, complaints and sanctions 54 22. Specific events of non-monetary defaults 29 Acronyms 56 23. When we decide not to extend a loan 31 Definitions 57 24. When we appoint property valuers, investigative accountants Transitional period 60 and insolvency practitioners 31 CHAPTER 1 Who the Code applies to
1. The Code applies to you, as defined in the table below:
“You” and “your” “Banking service” “You” and “your” means a person who, Banking service means any financial at the time we provide the banking service, service or product provided by us in or information is provided, is: Australia to you:
a) our customer, and where relevant, a) whether supplied directly or through a prospective customer, and is either: an intermediary; and
i. an individual, who is not treated b) if provided by another party and as a business under the Code; or distributed by us, extends only to the distribution or supply, and not to the ii. a small business; or service or product itself. b) a guarantor, or a prospective guarantor. Examples of banking services the Code applies to:
• bank accounts and term deposits;
PART 1 “We”, “us” and “our” • credit cards, debit cards, prepaid “We”, “us” and “our” means the bank that cards; you deal with that has signed up to the • home loan, personal loans, bill Code. How the facilities, overdrafts– in the Code these are included in the definition of “loans”; Code works Who is a “guarantor”? • consumer credit insurance; A guarantor is an individual who gives a • payment services; and guarantee to secure a loan that we give to another individual or to a small business to • foreign currency exchange services. which Part 7 of the Code applies. However, banking services the Code does not apply to include:
What is a “business”? • shares, bonds and other securities that A customer is treated as a business if they we issue; and apply for, or receive, a banking service for • financial products and financial a purpose that is wholly or predominantly services for the purposes of Chapter 7 a trading or commercial purpose, and of the Corporations Act 2001, if you are where the National Credit Code does not a ‘wholesale client’ rather than a apply. ‘retail client’ (unless you are a wholesale client only because of section 761G(7)(b)).
10 11 The Code forms part of our banking CHAPTER 2 What is a “small business”? “Farmer” is as defined in section 4 of the services and guarantees Farm Debt Mediation Act 1994 (NSW) Publication and review of the Code A business is a “small business” if at the 2. Our written terms and conditions for (meaning a person (whether an individual time it obtains the banking service all of all banking services and guarantees person or a corporation) who is solely or How the Code is to be publicised and the following apply: to which the Code applies will include principally engaged in a farming made available a statement to the effect that the relevant operation and includes a person who a) it had an annual turnover of less than provisions of the Code apply to the 4. We will promote the Code. owns land cultivated under a share- $10 million in the previous financial banking service or guarantee. year*; and farming agreement and the personal 5. We will ensure the Code is available and representatives of a deceased farmer). 3. The terms and conditions need not set accessible in different ways, including in b) it has fewer than 100 full-time out those provisions. hard copy and electronically. If you want equivalent employees*; and “Farming operation” is as defined in a hard copy you can ask us in a branch or section 4AB of the Farm Debt Mediation c) it has less than $3 million total debt over the phone and we will give or send Act 1994 (NSW) as meaning a business you one for free. to all credit providers — including: undertaking that primarily involves one or more of the following activities: i. any undrawn amounts under Three yearly reviews of the Code existing loans; (a) agriculture (for example, crop growing 6. The ABA will arrange for the Code to be and livestock or grain farming); independently reviewed at least every ii. any loan being applied for; and three years from the date this Code (b) aquaculture; iii. the debt of all its related entities comes into effect. that are businesses. (c) the cultivation or harvesting of timber 7. When reviewing the Code we will also or native vegetation; or However, a business is not a “small consult with consumer representatives, small business organisations and other business” if it is a company listed on the (d) any activity involving primary stakeholders. Australian Stock Exchange, a government production carried out in connection entity, or an Australian Financial Services with an activity referred to in Licensee that is authorised under its paragraphs (a)-(c). licence to operate registered managed investment schemes as a responsible Land is “in drought or subject to natural entity or to provide custodial and disaster” where an Australian State or depository services. Territory Government makes a declaration to that effect; or, if no such declaration is * Note: If the business is part of a group of made, where we are satisfied on other bodies corporate (see s. 50 Corporations grounds that the land is in drought or Act), paragraphs (a) and (b) are assessed subject to natural disaster. on the basis of the group. “Default interest” is the application of a higher annual percentage rate applicable under a loan because you are in default, for the period that the default continues.
12 13 PART 2 CHAPTER 3 CHAPTER 5 Our compliance with the Code Protecting confidentiality
Our commitments to the Code We will protect your confidentiality Your banking 8. We will honour the commitments we 11. We will meet our general duties under law make to you in the Code. to protect your confidentiality.
12. We will also have our own privacy policies relationship CHAPTER 4 available on our website. Trained and competent staff CHAPTER 6 Our staff and representatives will be trained and competent — including Compliance with laws about the Code How we will comply with the law and 9. We will make sure that our staff and our the Code representatives are trained so that they: 13. If the Code imposes an obligation a) can competently do their work; and on us that is in addition to obligations applying under a relevant law, then we b) understand the Code and how will comply with the Code unless doing so to comply with it when they are would lead us to breach the law. providing banking services. How our staff will engage with you CHAPTER 7 10. We will engage with you in a fair, reasonable and ethical manner. Closing a branch
Our commitments when closing a branch 14. We will comply with the ABA protocol when closing a branch. The protocol outlines our commitment to provide banking services to personal, and small business, customers in remote, rural and regional areas. This protocol is available at: ausbanking.org.au
14 15 CHAPTER 8 CHAPTER 10 Providing you with information Responding to your request for information We will give you clear information 15. We will give you clear information How we will respond to your request about our products and services so for information you can make an informed decision 22. We will answer your questions about about which product or service is suitable our banking services. for you. 23. If you ask us for advice on any of our 16. We may give you advice, or recommend banking services, then we will: that you seek advice. a) give it to you through staff who are PART 3 authorised and trained to give you that CHAPTER 9 advice; or Communication between b) refer you to someone else who Opening us and you can provide you with advice – for example: a lawyer, accountant, How we will communicate with you financial adviser or financial counsellor. 17. We will communicate with you in a timely an account manner and we will give you information C H A P T ER 11 that is useful and clear. What information we will give you 18. Anything that we are required to give and using to you under this Code may be given Terms and Conditions, Fees and Charges to you: 24. If you are entering into a contract for a a) in writing, electronically or by banking service with us, then we will give our banking telephone; you our: b) by telling you that the information a) terms and conditions; is available on a website or other services electronic forum; or b) fees and charges; and c) as otherwise agreed with you. c) if applicable, interest rates.
However, if the Code specifies the We will do this before, or when, the method of communication, then we contract is made. This information may be will comply with that method. in separate documents.
19. Where this Code requires us to 25. The documents provided in paragraph 24 communicate in writing, this includes will clearly set out: electronic communications. a) the amount of fees and charges and 20. All communication under this Code will how often they are credited or debited be consistent with our obligations under to your account; the law or other applicable codes. b) any interest rate that applies, how and 21. Our terms and conditions will be when different interest rates may apply, distinguishable from our marketing the method by which interest is material. calculated, and when interest will be debited to your account;
16 17 c) how often we give you statements Term deposits Exchange rates and commissions CHAPTER 12 of account; 27. Our terms and conditions for a term 29. If we give you a foreign exchange service Acquiring a new product or d) how we may change fees, charges, deposit account will contain the following (other than by credit card, debit card, or service interest or other terms and conditions, specific information: travellers’ cheque), then we will give you and how we will notify you of these the following information: a) how we will pay interest and repay We will ensure we have your agreement changes; the principal to you; a) details of the exchange rates and about fees commission charges that we know e) for a loan, whether the loan is 31. If we charge a fee for you to acquire a b) how funds may be dealt with at will apply — if we do not know those repayable on demand; and new product or service, then we will make maturity; and details, then we will give you the details f) a statement that information on sure we have your agreement to do so. c) details of any fee, charge, or change we know about how to find current standard fees, charges in an interest rate resulting from a out relevant information at the time and any interest rates is available withdrawal in advance of maturity. of the transaction; and on request. b) an indication of when any money Cheque accounts Specific information you send overseas would normally 28. Our terms and conditions for an account arrive at the destination to which you 26. If the following information applies to with cheque access will contain the are sending it. your banking service, we will give you following specific information: that information in, or with, our contract: Insuring your property a) the normal length of time we take to a) minimum balance requirement; clear a cheque; 30. If you have a loan and we have a security (for example, a mortgage) over your b) any restriction on depositing money, b) how you may arrange for us to clear primary place of residence or a residential or withdrawing money, from a relevant a cheque faster than normal – known investment property you own, then we will account; as arranging special clearance; remind you of your obligations to insure the c) the repayment details; and property. We will remind you of that at least c) how and when a cheque may be once a year. Our reminder will include: d) how we process your request to cancel stopped; a direct debit arrangement. a) a statement that you should check d) the effect of crossing a cheque; with your insurer about your cover; and
e) the meaning of ‘not negotiable’ b) a reference to the Australian Securities and ‘account payee only’; and Investments Commission’s f) the significance of deleting the words MoneySmart website moneysmart.gov.au ‘or bearer’ from a cheque; for information on property insurance.
g) how you may write a cheque so as to reduce the risk of it being changed in an unauthorised way; and
h) when we will not pay (known as, ‘dishonour’) a cheque – including if the cheque is post-dated or stale.
18 19 CHAPTER 13 When providing banking services to Indigenous customers Being inclusive and accessible 35. If you tell us you are an Indigenous customer, we will take reasonable steps to We believe in inclusive banking services make our banking services accessible to 32. We are committed to providing banking you. We will also: services which are inclusive of all people including: a) tell you about any accounts and services that are relevant to you; a) older customers; b) tell you about any accounts or services b) people with a disability; that have no, or low standard fees, if our enquiries indicate you may be c) Indigenous Australians, including in eligible for these and help you transfer PART 4 remote locations; and to another account you want; and d) people with limited English. c) help you meet any identification 33. We will train our staff to treat our requirements, by following AUSTRAC’s diverse and vulnerable customers with guidance on identification and Inclusive verification of persons of Aboriginal sensitivity, respect and compassion. and Torres Strait Islander heritage. We are committed to providing banking and services which are accessible When providing banking services to remote customers 34. We are committed to improving the accessibility of our banking services 36. We will also assist our customers who for people with a disability, older reside in remote communities (including accessible customers and people with limited remote Indigenous communities) to English. We will take reasonable measures access and undertake their banking to enhance their access services. banking to those services. 37. We will provide cultural awareness training to staff who regularly assist customers in remote Indigenous communities.
20 21 CHAPTER 14 CHAPTER 15 CHAPTER 16 account, we will offer you one of these accounts that has the special features Taking extra care with customers Banking services for people Basic accounts or low or no fee listed in this paragraph and, if we offer who are experiencing vulnerability with a low income accounts basic accounts, will also have the features listed in paragraph 44B. The We will take extra care with customers When providing transaction banking Basic accounts special features are: who are experiencing vulnerability services to low income earners 44A. We may offer ‘basic accounts’, or other a) No informal overdrafts (except where it 38. We are committed to taking extra care 42. If you are an individual and you tell us kinds of low or no fee transaction is impossible or reasonably impractical with customers who are experiencing that you are a low income earner, we will accounts. for us to prevent your account from vulnerability, including: give you: 44B. Basic accounts have, at a minimum: being overdrawn)
a) age-related impairment; a) information about our accounts that a) no account keeping fees; b) No dishonour fees; and may be appropriate to your needs; b) cognitive impairment; and b) free periodic statements (you can c) No overdrawn fees choose monthly or longer intervals); c) elder abuse; b) information about our accounts: You are not obliged to accept our offer of an account with the special features. You d) family or domestic violence; c) no minimum deposits (except that, if i. for which standard fees and charges your government benefit is paid into a may request (or we may offer you) other e) financial abuse; are low; or bank account of yours, you may be accounts (including other basic, low fee or no fee accounts) which do not have ii. for which there are no fees and required to have it paid into this f) mental illness; some or all the special features, or may charges (if we offer such a product). account); have additional features. g) serious illness; or 43. Our obligation in the previous paragraph d) free direct debit facilities; applies to you regardless of whether or We may also offer accounts with some or h) any other personal, or financial, not you are our customer. e) access to your choice of a debit card all of the special features, (and / or the circumstance causing significant (such as eftpos), or a scheme debit features in paragraph 44B), to individuals detriment. We may become aware if you are a low card offered by us (such as Visa Debit who are not eligible customers under this income earner only if you tell us about it. We may become aware of your or Mastercard Debit) at no extra cost; Chapter. circumstances only if you tell us about and If you receive a Commonwealth pension For the purposes of this Chapter: them. or concession, we will give you f) free and unlimited Australian domestic ‘eligible customer’ means an individual that is information about our low or no fee transactions*. 39. We will train our staff to act with sensitivity, not a business who holds a current a respect and compassion if you appear to accounts *Note that you may be charged for government concession card listed in be in a vulnerable situation. 44. If you apply for a new transaction certain ancillary services. For example, paragraph 44. 40. If you tell us about your personal or account, we will ask you if you have any bank cheques, telegraphic transfers, or of the following government cards. If you transactions at ATMs owned and ‘informal overdraft’ means credit we provide financial circumstance, we will work with when (without your express agreement) you to identify a suitable way for you to tell us that you have one of these cards, operated by third parties. then we will give you information about we permit you to overdraw your account. access and undertake your banking. We will raise awareness of basic, low or any basic bank accounts or other no fee accounts and give you information ‘no overdrawn fees’ means we will not charge 41. When we are providing a banking service banking services we offer that have low or a fee where your account falls into debit. about them to customers who are experiencing no standard fees and charges (see However, you may be charged interest on 45. We will raise awareness of our affordable vulnerability we will: Chapter 16): the amount in debit. banking products and services such as a) be respectful of your need for a) a Commonwealth Seniors Health Card; basic, low, or no fee accounts, including ‘no dishonour fees’ means we will not charge confidentiality; b) a Health Care Card; or that you may be eligible if you have a a fee because a debit on a basic, low or b) try and make it easier for you to government concession card. no fee account is declined due to c) a Pensioner Concession Card. insufficient funds in the account. communicate with us; 46. We will give you information that is easily Training for staff about customers eligible c) provide appropriate guidance and accessible about accounts that have low, referrals to help you to maintain, or or no, standard fees and charges. for basic, low, or no, fee accounts regain, control of your finances; and Special features for basic, low or no-fee 48. We will train our staff to help them to accounts for eligible customers recognise a customer, or potential d) refer you to external support, if customer that may qualify for a basic, appropriate. 47. If you are an eligible customer and you ask for a basic account, or a low or no fee low, or no fee account.
22 23 CHAPTER 17 a) have taken reasonable steps to ensure that you understand the risks A responsible approach associated with entering into the to lending loan, and understand the difference between being a co-borrower and Lending to individuals and a guarantor; small businesses b) have taken into account the reasons 49. If we are considering providing you why you want to be a co-borrower; and with a new loan, or an increase in a loan limit, we will exercise the care and skill c) are satisfied that you are not of a diligent and prudent banker. experiencing financial abuse.
50. If you are an individual customer, 55. A substantial benefit includes where: that is not a business, we will do this a) you acquire a reasonably PART 5 by complying with the law. proportionate legal or equitable 51. If you are a small business, when assessing interest in assets purchased with whether you can repay the loan we will the loan funds; or When you do so by considering the appropriate b) a reasonable portion of the loan funds circumstances reasonably known to us are used to repay your debts, about: or other obligations owed by you. apply for a) your financial position; or 56. You may end your liability under the loan b) your account conduct. by giving us a written request to do so in the following circumstances: Where reasonable to do so, we may rely a loan on the resources of third parties available a) where credit has not been provided to you, provided that the third party has or relied upon by any co- borrower; or a connection to you (that is, to the small b) for any future advances under the business). For example where the third loan, where we can terminate any party is a related entity of yours (including obligation we have to extend further but not limited to your directors, credit to any other co-borrower under shareholders, trustees, beneficiaries or the same loan. related body corporates), or is a partner, joint venturer, or guarantor of yours. 57. Paragraphs 53 to 56 do not apply to borrowers who are trustees, companies, 52. We also owe an obligation to any directors of co-borrower companies or guarantor of the loan to comply with partners in a partnership or joint-venture the above paragraph in assessing the arrangement. borrower‘s ability to repay the loan. We will tell you about our suitability Lending to co-borrowers assessment for a loan 53. If you are an individual applying for 58. If we approve your loan, and it is a loan, or an increase to a loan limit, regulated under the National Consumer paragraphs 54 to 56 apply to you. Credit Protection Act 2009, we will let you 54. If, on the information that you have know that you can obtain our assessment provided to us in the course of applying for about whether it is not unsuitable for you. this loan, you will not receive a substantial benefit from the loan, we will not approve you as a co-borrower unless we:
24 25 59. If you are a guarantor, we will let you 63. Before we enter the contract with you, we Deferred sales period for CCI for know that you can also request a copy will ensure we have your express consent credit cards and personal loans sold free of charge. to acquire the product. in branches or over the phone
We will assess your ability to repay a Separation of application process for 67. If we offer CCI for credit cards and credit card within a three year period CCI for credit cards and loans sold in personal loans through a branch or digital channels over the phone, then we will not offer 60. When you apply for a new consumer credit that product to you until at least four card or credit limit increase, we will assess 64. We will refer to the availability of CCI only days after you have applied for the your ability to repay the amount of the after you have completed the digital credit product. This is known as a credit card limit within a three year period. application for a credit card or loan. ‘deferred sales period’.
60A. If the National Credit Code would apply to 65. We will let you know that whether you 68. We can still provide factual information the new loan or loan increase we are purchase CCI or not has no bearing on on CCI for you to consider during the considering providing to you, we will factor whether we approve you for a credit deferred sales period. in your ability to repay the amount of your card or loan. existing credit card limits within three years when complying with our obligations to 66. We will use clear disclosure for CCI CHAPTER 19 you in this Chapter. on credit cards and loans to enable customers, as they navigate through the Lenders mortgage insurance Setting a credit card limit when you apply digital experience, to better understand this type of insurance. This will be through: 61. You can let us know what your preferred Lenders mortgage insurance contracts credit card limit is and we will not give you a) Use of filtering questions so that we 69. We may require you to pay for lenders a limit that is more than what you alert you to key policy exclusions such mortgage insurance in connection with requested. Transactions may be as age, residency and employment a loan you have. If we do this, we will give processed which nevertheless cause status and if you are not eligible to you a fact sheet about lenders mortgage you to exceed your limit. claim a significant part of the policy, insurance. The fact sheet will contain not offering this product. information outlining the key policy features.
CHAPTER 18 b) Disclosing the limits of the policy as 70. We will not charge you more for lenders part of the process (the circumstances mortgage insurance than the actual Our approach to selling consumer in which a payout will be made and cost we incur for that policy. We will not credit insurance (CCI) the amount of the payout). receive a commission on your lenders mortgage insurance policy. Our approach to selling CCI for credit c) Disclosing any incentives you might cards and loans receive from taking out the CCI 71. Depending on the terms of the lenders product and their effect. mortgage insurance policy, if your loan 62. If we offer CCI, then we will give you clear is repaid or refinanced before the end information that enables you to make an d) Telling you the total cost of the of the policy, then you may be entitled to informed decision — including (to the insurance (if known) before you a refund of part of the fee or charge you extent we can): complete the CCI purchase. have paid. We will explain this to you in a) the cost of the CCI, including any e) Telling you how the premium is to the fact sheet. interest you will pay on the premium; be paid.
b) how long you would be insured for; f) Where the ongoing premium is calculated as a percentage or a cost c) the monetary limits on the key benefits per dollar of the outstanding debt or payable under the insurance; and statement balance, then we will tell d) the date your insurance ends, if that you that cost and how we calculate it. date is different to the date on which the underlying credit product ends.
26 27 CHAPTER 20 77. We may give you a shorter notice period, or no notice period, if: Helping a small business a) the default is unable to be remedied; when it applies for a loan or
What we tell a small business when they b) it is reasonable for us to do so to apply for a loan manage a material and immediate risk 72. We will tell a small business how to apply relating to the nature of the relevant for a loan, including the following: default, your particular circumstances, or the value of the security; or a) the information we require; and c) we have already given you a period to b) after we have received the information remedy the default under paragraph we have requested, how long before we 81, and you have not remedied that PART 6 are likely to make a decision. default. 73. Before you accept a loan offer, we will give 78. If you have an overdraft or on- you a plain English document clearly setting demand facility, we may not be required Lending out the key general terms and conditions of to give you any notice the loan. This is in addition to the disclosures when we require repayment, but if a required under Part 3 of the Code, and may failure to repay that facility on demand be a separate document or part of the loan also constitutes default under another to small document. loan with us, we will comply with this Chapter if we enforce that other loan 74. If we decide not to approve a loan to based on that default. a small business we will tell the small business the general reason why unless it is business reasonable for us not to do so. CHAPTER 22 Specific events of CHAPTER 21 non-monetary defaults
When will we not enforce a loan This chapter applies to standard form small against a small business? business loans. In this chapter, ‘guarantor’ means any guarantor of a small business, For special conditions about non- not limited to a guarantor who is an monetary defaults, see chapter 22 individual. How much notice we give a small Loan terms and conditions business before enforcing a loan? 79. Our loan terms and conditions will specify 75. If you are a small business and in default how and when we will not enforce a loan under your loan, we will give you 30 days’ against a small business for non-monetary notice before we either require you to defaults. repay the loan in full, or take enforcement proceedings.
76. If you remedy the default during the 30 day period, and no default of the same type has arisen during that period, we will not require full repayment or take enforcement proceedings.
28 29 Enforcement of small business loans for k) legal or beneficial ownership, or Specialised small business loans 89. Our communication will be clear and we management control of a borrower or will explain the purpose of the valuation non-monetary defaults 85. For the following types of small business guarantor or their business changes to the customer. 80. If you are a small business and you have standard form loans, we may include without our consent; or met all your payment obligations under financial indicator covenants or special When we will provide you with a copy of a covenants tailored to the particular the loan terms, we will not take default l) status, capacity or composition of valuation based action against you unless: you or a guarantor changes without nature of these loans as a trigger for 90. Where we have charged you (or you have our consent. default based action: a) you or a guarantor is insolvent, reimbursed us) for a valuation of a goes into bankruptcy, voluntary What we will do before we take default a) loans for property development; or: commercial or agricultural real property, administration, other insolvency we will provide you with a copy of that based action b) loans for a specialised lending process or arrangement, or no valuation and the related valuer transaction, where because of their longer has legal capacity; Remedying your non-monetary default instruction (except where enforcement nature, require additional covenants 81. We will: proceedings have commenced). b) enforcement proceedings are taken as a way of banks managing their risks, against you or a guarantor or your a) give you a notice specifying the including margin lending, loans to We may require you to acknowledge in or their assets by another creditor; grounds on which we consider there is self-managed superannuation funds, writing that you accept our reasonable a non-monetary default; and bailment, invoice discounting, limitations on your use of the valuation c) early repayment is required under a construction finance, foreign currency before we provide it to you. separate financing arrangement you b) allow a reasonable time for you to loans and tailored cash flow lending. or a guarantor has with us, or default remedy your non-monetary default, 91. We will only appoint appropriately based action is taken against you or where it is able to be remedied, and qualified and experienced valuers a guarantor by us, due to an event notify you of this time period. CHAPTER 23 who are members of professional of default which is described in organisations which abide by a similar this chapter; 82. If paragraph 81 applies, a reasonable time When we decide not to extend code of practice. will not be less than 30 days unless it is a loan d) we believe on reasonable grounds reasonable for us to act to manage a Appointing investigating accountants that you or a guarantor has not material and immediate risk relating to the How much notice will we give a small and insolvency practitioners (including complied with the law or any nature of the relevant default, your business before the end of a loan voluntary administrators) requirement of a statutory authority, particular circumstances, or the value of 86. If you are a small business and you are 92. We will act fairly when using investigative or it becomes unlawful for you or us the security. to continue with the loan; not in default, and the principal owing on accountants and insolvency practitioners, Material impact your loan is not due to be fully repaid at and will ethically manage potential e) you or a guarantor gives us information the end of its scheduled term by regular conflicts of interest when appointing or makes a representation or warranty 83. We will only act on a specific event periodic repayments, we will give you receivers who have been investigating to us which is materially incorrect or of non-monetary default identified in notice of our decision not to extend your accountants for a small business, for misleading (including by omission); paragraph 80, if the event by its nature loan, at least 3 months before you need example: is material, or we reasonably consider to repay your loan in full. f) you use the loan for a purpose not the event has had, or is likely to have, a) We will only appoint qualified approved by us; a material impact on: 87. If we decide to extend or refinance your practitioners who are members of loan, we are not required to do so on the relevant professional organisations with g) your assets or a guarantor’s assets a) you or your guarantor’s ability to meet same terms. appropriate codes of conduct. are dealt with, or attempted to be your or their financial obligations to us dealt with in breach of the loan, or any (or our ability to assess this); b) We will require additional internal security or other agreement with us CHAPTER 24 oversight of the appointment of without our consent; b) our security risk (or our ability to assess investigating accountants as receivers, this); or When we appoint external to ensure that the decision is necessary h) you or a guarantor do not provide property valuers, investigative and to review the circumstances financial information required by your c) our legal or reputation risk where leading to the appointment. agreement with us; paragraph 80(d) or (e) and (f) applies. accountants and insolvency practitioners c) If the relationship between the i) you or a guarantor do not maintain a General material adverse change clauses bank customer and the investigating licence or permit necessary to 84. We will not include a general material When using external property valuers accountant has deteriorated (for conduct your business; adverse change clause as an event of we will be fair and transparent example has become unworkable) default in any standard form small business j) you or a guarantor do not maintain 88. Our processes in relation to external expert the bank will consider the appointment lending contract. insurance required by your agreement valuations will be fair and transparent. of an alternative qualified practitioner. with us;
30 31 When this part applies CHAPTER 26 93. If you are an individual who gives a guarantee and/or indemnity to What we will tell and give you secure a loan that we give to another individual or small business, and this Code Before accepting a guarantee applies to the loan, then this part of the Notice to you Code applies to your guarantee and/or 96. The terms and conditions of the indemnity. guarantee will contain a prominent notice that: CHAPTER 25 a) you should seek independent legal and financial advice; Limiting liability under PART 7 the guarantee b) you can refuse to sign the guarantee; c) there are financial risks involved; Before accepting a guarantee 94. Your guarantee will be limited to: d) you can limit your liability in Guaranteeing accordance with this Code or as a) a specific amount and/or category allowed by law; of amounts such as all amounts owing under a specific loan, plus other e) you can request information about the a loan liabilities and amounts as described transaction or loan; and in the guarantee (for example, f) if applicable, that the guarantee may interest and recovery costs); or cover future credit facilities and b) the value of a specified property variations of the existing loan. or other assets under a specified 97. We will tell you: mortgage or other security at the time of recovery. a) about any notice of demand we have made on the borrower for the During the guarantee guaranteed loan, or any loan the 95. You may write to us to limit, or further limit borrower has (or has had) with us, the liabilities you have guaranteed under within the previous two years; and your guarantee. However, we do not have b) if any existing loan we have given to accept your request if: the borrower will be cancelled if the a) the amount, or nature, of the limit you guarantee is not provided. request does not cover the borrower’s This paragraph does not apply if existing liability (plus any interest owed, you are a commercial asset financing or any fees, or charges that we may guarantor, sole director guarantor or incur in respect of that liability) under trustee guarantor. the relevant loan contract at the time;
b) we are obliged to make further advances to the borrower; or
c) we would be unable to preserve the current value of an asset which is security for the loan without making further advances.
32 33 Required warning notice What we will tell you if you are a Extending your guarantee Signing your guarantee 98. We will ensure that a warning notice director guarantor 104. If a borrower obtains a new loan or has 109. We will give the guarantee documents appears directly above the place where 100. If you are a director guarantor (other than changes made to an existing loan, then directly to you or your representative. you sign the guarantee. The warning a sole director guarantor) we will tell you these may be covered by your guarantee We will not give the guarantee documents notice will be substantially in the form that you have the right to receive the to the extent they fall within the limit to the borrower, or to someone acting on required by section 55 of the National documents in paragraphs 96 to 99, and contained in your guarantee. behalf of the borrower, to arrange for you Credit Code, and detailed in Form 8 of that these documents contain important to sign the guarantee. 105. If we agree to increase the limit in your the National Consumer Credit Protection information that may affect your decision guarantee, we will: 110. If we attend the signing of the guarantee, Regulations 2010 and consistent with to give a guarantee. You may choose not we will ensure that you sign the guarantee this Code. to receive some or all of the documents, a) give you what is required under in the absence of the borrower. and we will not influence your choice. paragraph 99; and Guarantee documents Paragraphs 109 and 110, do not apply if 99. We will give you a copy of the following During the guarantee b) obtain your written acceptance of you are a commercial asset financing documents in relation to the borrower: 101. We will give you the following information, the extension of the guarantee. guarantor, sole director guarantor or about a borrower’s deteriorating financial a) the proposed loan contract; 106. In these circumstances, we will trustee guarantor. position as it relates to the loan you provide you with any unsatisfied notice b) a list of any related security contracts; guarantee, within 14 days of the of demand made by us on the borrower relevant event: in respect of the loan. CHAPTER 28 c) any related credit report from a credit reporting body; a) a copy of any formal demand or Withdrawing or ending default notice we send to the borrower your guarantee d) any current credit-related insurance after we send it; CHAPTER 27 contract that is in our possession; b) a written notice if the borrower has Signing your guarantee Withdrawing your guarantee e) any financial accounts or statement advised us that they are experiencing 111. You may, by written notice to us, When we can accept your guarantee of financial position the borrower has financial difficulty which has resulted withdraw from the guarantees: given us in the previous two years for in a change to their loan; and 107. We will not accept a guarantee from you the purposes of the guaranteed loan; until the third day after you have been a) at any time before we provide c) a written notice if the borrower is given the information provided at credit under the relevant loan; or f) the latest statement of account in continuing default for more than paragraph 96 to 99. relating to the loan for a period in two months after the issuance of the b) after credit is first provided, if the which a notice of demand was default notice referred to above. 108. However, we can accept the guarantee signed version of the relevant loan made by us within the last two years; earlier if you: differs in a material respect from the and 102 If you ask us to, we will give you additional proposed loan we gave you before copies of any information we have given a) have obtained independent legal you signed the Guarantee. This does g) other information we have about the you – we will do so within 30 days. advice about the guarantee; not apply to any change to the loan guaranteed loan that you reasonably described in paragraph 104. request — but we do not have to give 103. However, we do not need give you b) have accepted an extension of the you our internal opinions. those copies if we have given you guarantee; However, you may do so only to the information you requested within the extent of the obligations under c) are a commercial asset financing This paragraph does not apply if you are three months before your request. the guarantee. a commercial asset financing guarantor, guarantor, sole director guarantor, sole director guarantor or trustee guarantor. Paragraphs 101, 102 and 103, do not trustee guarantor or vehicle asset apply if you are a commercial asset financing guarantor; or financing guarantor, sole director guarantor or trustee guarantor. d) you are a director guarantor and you choose to sign and deliver the guarantee earlier. We will not influence your choice.
34 35 Ending your guarantee b) if one (or more) of the following has occurred: 112. You may end your liability under a guarantee you have given to us by: i. we have obtained Court judgment in our favour against the borrower for a) paying us the lower of: payment of the guaranteed liability; i. the borrower’s outstanding liability, and the judgment debt remains including any future or contingent unpaid for at least 30 days after our liability; or written demand for its payment; ii. the amount to which your guarantee ii. we have made reasonable attempts of the borrower’s liability is limited to locate the borrower but without under the guarantee; or success; or b) making other arrangements we agree iii. the borrower is insolvent. to in return for releasing you from your 115. However, the restrictions under paragraphs guarantee. 113 and 114 do:
a) not apply if you have specifically CHAPTER 29 agreed in writing after the default notice is issued and we have informed Enforcing our rights under you of the limitations of our enforcement the guarantee rights under this chapter that they do not apply; or How we will enforce our rights under the guarantee b) not require us to first enforce any mortgage or other security that 113. We will not enforce any mortgage or other the borrower has provided if we security you have given us in connection reasonably expect that the net with the guarantee unless we have first proceeds of that enforcement will not enforced any mortgage or other security be sufficient to repay a substantial that the borrower has provided for the portion of the guaranteed liability, or guaranteed liability. This paragraph does because of the borrower not providing not apply where the guaranteed liability us with information, documents, or arises under a standard margin loan. access to premises or assets as 114. We will not enforce any judgment against required, we are unable to reasonably you under the guarantee unless: assess whether the net proceeds of that enforcement will not be sufficient a) we have first enforced any mortgage to repay a substantial portion of the or other security that the borrower has guaranteed liability. provided for the guaranteed liability; and
36 37 CHAPTER 30 What if the National Credit Code’s statement rules do not apply to your loan Keeping your accounts safe or credit account? and secure 121. If you are a small business or an individual and the rules in the National Credit Code We will tell you about safeguarding about statements of account do not apply important items to your loan or credit account, 116. We will tell you to safeguard your payment then we will give you a statement of documents, cards and devices. transactions on your account as though those rules did apply. We will tell you when you should tell us if any of those items are lost or misused 122. However, we do not have to do that if the nature of the relevant banking service 117. Our terms and conditions set out means it is impractical for us to do so. when you should tell us if any payment documents, cards or devices are lost or misused. CHAPTER 32 PART 8 118. We will tell you about: Cost of transaction service fees a) how you can notify us of the loss, We will tell you the cost of transaction theft or misuse; and service fees Managing b) the consequences of you not telling 123. If you are an individual that is not a us about the loss, theft or misuse. business, we will tell you about a transaction service fee immediately before your account CHAPTER 31 you incur the fee, if it is practical and reasonable for us to do so. Statements we will send you 124. However, it may not be practical or reasonable for us to do so in certain When will we give you statements circumstances — for example: for your deposit account? 119. At least every six months — or more a) dishonour fees; frequently if you ask — we will give you an b) if the fee is charged based on end-of- account statement for a deposit account day balance and, therefore, is not (unless it is a passbook account). necessarily incurred at the time of the transaction — for example, an When will we give you statements if you overdrawn fee based on end of day are in default on your loan account? balance; 120. If you are in default on your loan account, then we will give you a statement of c) if you are making an online purchase: account or alternative (for example, from a third party, using a merchant transaction history) if you ask for it. terminal, or using another bank’s ATM, or
d) break costs, which may be incurred if your transaction makes a prepayment to a fixed rate loan.
38 39 CHAPTER 33 Credit card limit increases CHAPTER 34 CHAPTER 35 129. We will not offer to increase your consumer Managing a credit card or credit limit on your existing credit card other Direct debits and Joint Accounts debit card than in response to a request by you for the recurring payments increase in your credit limit. How to use a joint account We will pay off your higher interest We will give you a list of your direct debits 138. If you have a joint account, we will tell credit card debts first You can ask us to dispute a transaction and recurring payments you how you can use that account. on your credit or debit card account 125. Any payment you make to your consumer 134. If you ask us to, we will give you a list of How you can stop withdrawals credit card will be applied first to the 130. If, within the time limit set by your direct debits and recurring payments amounts that have the highest interest credit card or debit card scheme rules, on your accounts for up to the previous 139. If you have a joint account, from which rate as at the last statement date. you tell us that you dispute a transaction 13 months. The list will include only those either you or another account holder can However, if you ask us to, we may agree on your card, then we: direct debits and recurring payments make withdrawals, you can ask us to to apply a repayment against a specific that are known to us from the information change the account authority so that you debt owed. a) will claim the relevant amount back if we receive about your transactions. all have to approve any future withdrawals. we find it be incorrectly charged and This may be relevant to you if you are Charging interest retrospectively on you have not contributed to the loss; or The regular payments from your: vulnerable (see chapter 14). portion of credit card balance that is b) may accept the merchant’s refusal a) deposit account are called ‘direct paid off by the due date 140. The above paragraph does not apply to to make that chargeback only if the debits’. This is where you have given directors of a company who are signatories 126. If you have an interest-free period on a refusal is made in a way allowed under your deposit account details (BSB and on behalf of the company, rather than joint consumer credit card balance, or part the relevant card’s scheme rules. account number) to allow a merchant account holders in their personal capacity. of a balance, for a period of time, we will or service provider to debit your account not retrospectively charge you interest for 131. You have the rights under the above regularly to pay for the services they that period because you didn’t pay off paragraph even if the payment was provide you. CHAPTER 36 that balance, or part of that balance, debited from your credit card or debit by the due date. card account and was part of a recurring b) credit or debit card are called Closing any of your payment arrangement you have with that ‘recurring payments’. This is where you banking services We will give you notice before an merchant. have given your credit or debit card introductory balance transfer offer ends details (card number, expiry date and We will give you information 132. You may also have a right to dispute security code) to allow a merchant or 127. If you have an introductory balance about closing your accounts an unauthorised transaction under the service provider to charge your credit transfer offer on your consumer credit card, ePayments Code or as contained in your or debit card regularly to pay for the 141. We will give you readily accessible we will give you at least 30 days’ notice terms and conditions. services they provide you. information about how to close before it is due to end. your account. 133. We will make general information about What we will do when you ask to cancel You may ask us to reduce your credit disputed transactions available to you a direct debit or advise us of a problem You may close your accounts card limit and notify you of the availability of this with a direct debit information at least once every 12 months. 142. If you want to close your account, then we 128. If you ask us to reduce your existing 135. You can ask us to cancel your direct debit will enable you to do this quickly and easily. consumer credit card limit, we will enable request and we will promptly process this. Some products may have a minimum you to do this online or by contacting us. notice period. This will be subject to any product 136. You can ask us to investigate an features that apply (for example, where unauthorised direct debit and we will We may close an account that is in credit the product requires a minimum limit). act promptly to assist you. 143. We may close an account of yours under its terms and conditions if that account is in You will still be required to first repay 137. When we handle your cancellation or credit. If we do so, we: any amount above the new limit. complaint, we will not inform you that you should first raise the cancellation or a) will, if appropriate, give you reasonable complaint directly with the merchant you notice of the closure; pay through the direct debit. However, we may suggest that you also contact b) will pay you the amount of the credit that merchant. balance; and
40 41 c) may charge you an amount that is 147. However, we do not have to give you a CHAPTER 38 155. We may give you a shorter notice period, our reasonable estimate of the costs copy of either of the following documents or no notice, of an unfavourable change if: of closing your account. under the above paragraph: When we change our a) It is reasonable for us to manage a arrangements with you We will tell you if we cancel your a) a notice requiring you to take action if material and immediate risk; or you ask for the copy more than two credit card When we can change the terms of years after the contract to which the b) there is a change to, or introduction 144. If we cancel your credit card we will tell notice relates was discharged or conditions of our banking services of a government charge that you you. If appropriate, we will give you the ended; or 151. The terms and conditions of a banking pay directly, or indirectly, as part of general reasons for doing so. service may allow us to change those your banking service. In that case, we b) a statement of account within three will tell you about the introduction or You can ask us to cancel your consumer terms and conditions in certain situations months after we gave you a copy of without your agreement where allowable change reasonably promptly after the credit card the same statement of account. under unfair contract terms laws. government notifies us (however, we 145. If you want to cancel your consumer do not have to tell you about it if the When we will give you the documents credit card, we will provide the ability for When we tell you about a change to the government publicises the introduction you to do this online or over the phone. If you ask for terms and conditions of our banking or change). you ask us to, we will give you information 148. If we are giving you a copy of a document services How we will tell you about changes about recurring payments and your under the above paragraph, then we will 152. If we change our terms and conditions, to our arrangements with you? outstanding balance. do so within 30 days. we will tell you about the change as soon 156. We will tell you about these as reasonably possible. This includes a We may waive or refund fees for changes either: change to: CHAPTER 37 providing you with a copy of a a) by advertising in the national, document or statement a) our standard fees and charges; or Your right to copies of or local, media; or 149. We may charge you a reasonable fee for certain documents b) an interest rate. providing you with a copy of a document b) by giving you written notice. We will give you certain documents under this Code. However, in certain 153. If we change an interest rate, we will tell circumstances we may waive or refund you ask for you no later than the date of the change, that fee. unless we are not able to because the 146. We will, at your request, give you a copy of interest rate is calculated according to a 150. We may charge you a fee for hard copy your documents in our possession including: money market or some other external statements that are not repeat statements. reference rate, or a rate otherwise a) a contract — including terms and If you tell us, and we are reasonably designated as a variable or floating rate. conditions, standard fees and charges satisfied that you do not have access to and interest rates; electronic statements, then we will waive 154. Apart from changes to interest rates or or refund that fee. b) any mortgage or other security changes to repayments, if we believe a document; change is unfavourable to you, then we will give you prior notice of at least 30 c) a statement of account; and days, subject to paragraph 155.
d) any notice we previously gave to you which is relevant to us exercising our rights.
42 43 CHAPTER 39 162. If we are working with you to help you respond to financial difficulties, then you Contact us if you are experiencing can tell us to deal with your financial financial difficulty counsellor or representative — rather than dealing with you. To do this, you What does “financial difficulty” mean? will need to give us their contact details in writing. 157. Financial difficulty means you are unable to repay what you owe and 163. However, we may still deal with you are experiencing difficulty meeting directly in the following situations: your repayment obligations. This can be as a result of an unexpected event or a) if you ask us to; unforeseen changes outside your control. b) if we have made reasonable attempts to contact, or deal with, your financial We encourage you to contact us if you counsellor or representative but we are are experiencing financial difficulty unsuccessful; or 158. If you are experiencing financial difficulty, then you, or your representative should c) if your representative is not a financial contact us as soon as possible. We will counsellor, and discuss your situation and the options i) we reasonably believe the available to help you. The sooner you representative is not acting in your best contact us, the sooner we can try to help. interests; or
If you have a joint account and are ii) it is otherwise reasonable to do so in the PART 9 experiencing financial difficulty circumstances. 159. If you have a joint account with someone If we decide to deal with you directly and you are experiencing financial under (b), or (c), we will tell you, and will difficulty, then we can assist you. If you ask suggest other free alternatives that may us to, we can do so without involving the When things be available to you. other person initially. 164. We will respond promptly to you — or your If you guarantee a debt to us and representative’s — request to discuss your go wrong are experiencing financial difficulty financial difficulties. Our reply will be within 160. If you are a guarantor and we have made the timeframes set by the National Credit a demand for you to pay under Code, if it applies. a guarantee and you are experiencing financial difficulty, then contact us as soon as possible and we will discuss your options.
Be open about your situation of financial difficulty 161. When you contact us, or are thinking about contacting us, it is important for you to be open, and as realistic as you can be, about your financial position. In turn, we will be compassionate in trying to understand your situation and when discussing any way we can help.
You can choose to have us deal with your financial counsellor or representative 44 45 CHAPTER 40 What we will consider when deciding on assistance options How we may be able to help We may contact you if you are 169. When we are deciding whether, and how, experiencing financial difficulty to help you with financial difficulty, we will take into account the information available We may contact you if we think you to us, including information you give us are experiencing difficulty about your financial situation. Restoring your financial position is possible 165. We will employ a range of practices that Examples of how we may help you if can identify common indicators of financial Our financial hardship arrangements focus on situations from which you can recover your difficulty. If we identify that you may be you are experiencing financial difficulty financial position. experiencing difficulty paying what you 170. The table on page 47 sets out examples of In these situations, we may be able to help you by: owe under a loan (or are experiencing steps we may be able to take to help you financial difficulty), then we may contact in particular situations. • agreeing to interest only payments for a short period; you to discuss your situation and the options available to help you. We will do this on a When we may waive your debt • extending the term of your loan to reduce your repayments; or case-by-case basis. 171. In exceptional circumstances, we may • temporarily postponing or deferring payments. look outside normal processes to find a 166. If we are able to contact you and discuss way to assist you if you are experiencing These arrangements may require you to pay more interest over the loan term. your situation under paragraph 165 and long term hardship as a result of a we offer basic bank accounts, and you are material change in circumstances. What you can do eligible, we will offer this product to you.
172. If you are an individual, we may, at our In these circumstances, contact us and we will help you work out what you need to do. discretion, reduce or waive your debt if CHAPTER 41 it is an unsecured personal loan or credit We will try to help you if you are card, on a case by case basis and on experiencing financial difficulty compassionate grounds, having regard to the following: Restoring your financial position is unlikely We will work with you to help you respond a) your individual circumstances; to financial difficulty b) if you are unable to meet your A permanent change to your financial situation may mean it is now unlikely that your financial 167. With your co-operation, we will work with repayments now and in the future; position can be recovered — even if your existing loan were to be changed. you to help you find a sustainable solution to your financial difficulties. Any help we c) whether the hardship is genuine and In that case, it may not be appropriate, for us to offer you changes to any payment arrangements can give will depend on your individual being caused by factors outside your under the National Credit Code’s financial hardship process. circumstances. We provide help to control; and customers on a case-by-case basis. However, even in these circumstances, we may be able to offer you help — d) our commercial considerations. for example, options may include: We will give you information about We will tell you about the relevant • agreeing on an alternative arrangement, plan or contract; our financial difficulty processes National Credit Code provisions if they • changing the terms of your loan; 168. We will make information publicly apply available about our processes for working • giving you time to sell your property; or with customers in financial difficulty. 173. We will tell you about the hardship provisions of the National Credit Code • giving information about bankruptcy or insolvency arrangements. if they apply to you. What you can do
In these circumstances, contact us and we will help you work out what you need to do.
We may refer you to people who can help you find a financial adviser or financial counsellor.
46 47 174. We will tell you about your right to make deferrals, refunds or fee waivers. 182. If we sell a debt to another party, we will CHAPTER 44 a complaint to our external dispute only choose a party that has agreed to resolution provider if we do not assist comply with these guidelines. Combining your accounts you under the National Credit Code. CHAPTER 42 What we will tell you if we sell your We will inform you if we combine or set-off We will not require you to access When you are in default debt to another party and we will not your accounts your superannuation be your contact We will tell you if we report your default 186. If we combine or set-off your accounts, 175. We will not require you to access your activity to a credit reporting body 183. If we sell your debt to another party, and including using available funds in one of superannuation to pay any amount you will be obliged to pay the debt to that your accounts to repay a debt you owe 179. We will tell you if we report any payment you owe us under a loan (unless you other party, and we will no longer be your us, then we will promptly inform you we default of yours under your loan to a credit are borrowing for a self-managed contact, we will write to you to let you know have done so. superannuation fund). However, you may reporting body. You can also independently and to explain: wish to discuss this option with a financial obtain a copy of your report directly from a When we cannot combine your accounts counsellor. You can also find out more credit reporting body. a) that we have sold your debt; and 187. If you have an account that relates to any about this from the Department of Human Charging default interest during drought b) who we have sold it to. amounts you owe us under a loan that is Services, see humanservices.gov.au and natural disasters regulated by the National Credit Code, We will not sell debt when we are then we may not combine that account Other people who can assist you 179A. considering your financial situation in any of the following circumstances: 176. If you ask us to, we will refer you to a) Where you are a farmer and we have 184. While either of the following is the case, financial counselling organisations that a) while we are actively considering your provided you with a loan for the we will not sell your debt to anyone else if: may be able to help you. We may also financial situation under either: purposes of a farming operation, we will recommend on our own initiative that a) we are actively considering your not charge default interest (or any fee i. paragraph 167 of this Code; or you seek independent advice from a financial situation: in lieu of default interest) on that loan financial counsellor. ii. under the hardship provisions of the during any period that the land you use i. under paragraph 167; or National Credit Code; or We will tell you about our decision for that operation is in drought or ii. under the hardship variation in writing subject to natural disaster. b) while you are complying with an provisions of the National Credit arrangement you have made with us 177. We will tell you in writing: b) For subparagraph (a) to apply, you may Code; or after we have considered your financial need to tell us about the b) you are complying with an arrangement situation; or a) whether we will provide you with help in circumstances, and we will refund any that you and we agreed to after we relation to your financial difficulty; and default interest or fees in lieu of default c) if doing so breaches Code of completed any considerations of the interest which were charged during Operation: Recovery of Debts from b) the reasons for our decision. type referred to in this paragraph. your default and the drought or natural Department of Human Services 178. If we agree to provide you with help in the disaster. 185. However, we may transfer your debt in Income Support Payments or form of changes to your agreement with us, either of those circumstances if the transfer: Department of Veterans’ Affairs then we will tell you in writing about the Payments. main details of the arrangements, including: CHAPTER 43 a) is part of a funding arrangement — for example, a securitisation or the 188. If we are considering your financial a) the repayments you need to make When we are recovering a debt issue of covered bonds or similar situation in either of the ways referred under the proposed new arrangement; funding arrangements; or to in the above paragraph, then we may We will comply with debt require that you keep funds in an account b) what will happen at the end of the collection guidelines b) is part of a sale of business or business until we have decided whether to agree new arrangement; and restructure. to your request. 180. We will comply with the ACCC’s and ASIC’s c) whether you accepting the proposed Debt Collection Guideline: for Collectors new arrangement will have any adverse and Creditors. consequences in relation to banking services or your credit history (for 181. We will comply with the Code of example, an entry in your credit report or Operation: Recovery of Debts from cancellation of a banking service). Department of Human Services Income Support Payments or Department of This does not apply to minor individual Veterans’ Affairs Payments. instances of help we provide — for example:
48 49 CHAPTER 45 191. Prior to probate or letters of administration being granted, if we receive a request Helping with deceased estates from a person authorised by a will, a person identified as a next of kin in the Deceased’s representatives death certificate or other official document acceptable to us, or a person 189. We will treat the deceased person’s who has applied for letters of representative with respect and administration, and on providing a copy compassion and provide clear and of the death certificate, we will, within accessible information on what you, the 14 days of receiving the necessary deceased’s representative, can do to information: manage a customer’s account in the event of their death. This information will a) provide access to information about include: the deceased’s account including relevant ongoing fees; and a) how to notify us of a customer’s death; b) receive payment towards a debt b) who has authority to access the owed to us by the deceased. customer’s account or loan details;
c) what information we need to verify Joint accounts the identity and authority of that 192. If you are a joint account holder with a person; and deceased customer, you may continue to operate the account subject to the terms d) what steps the person authorised and conditions of the account. needs to take to manage the deceased customer’s accounts, including information about direct debits and recurring payments on those accounts, and we will assist you to manage direct debits and recurring payments in the ways outlined in Chapter 34.
190. Once notified of a customer’s death we will:
a) identify any fees that are for products and services that can no longer be provided, or will not be provided to the deceased’s estate;
b) stop charging those fees;
c) if any fees referred to in paragraph (a) have already been charged since the customer’s death – refund those fees; and
d) act on instructions concerning a deceased ‘s account from a person named in a grant of probate or letters of administration within 14 days of receiving the necessary information.
50 51 CHAPTER 46 you that you may have a right, as an alternative to farm debt mediation, Our Customer Advocate to make a complaint to our external dispute resolution provider. We will have a Customer Advocate in 199. If we do not reach an agreement at our bank a farm debt mediation and you then 193. We will have a Customer Advocate in our decide to make a complaint to our bank to help facilitate fair customer external dispute resolution provider, outcomes and minimise the likelihood of we will give our consent for the external future problems. dispute resolution provider to consider the complaint. This paragraph only applies The Australian Banking Association’s where your complaint would have been Guiding Principles for Customer excluded by our external dispute Advocates are available at: resolution provider because it had ausbanking.org.au previously been the subject of a farm debt mediation. CHAPTER 47 If you have a complaint about us CHAPTER 48 How we handle your complaint You can access free internal and external dispute resolution processes We will be fair and reasonable and will 194. If you have a complaint, contact us in the keep you informed first instance PART 10 200. We will ensure our process for handling 195. If we are unable to resolve your complaint your complaint is fair and reasonable. to your satisfaction, we will give you 201. We will keep you informed of the progress information on how you can take your Resolving of your complaint. complaint to the Australian Financial Complaints Authority (AFCA). 202. We will give you the name of a contact person who is handling your complaint 196. Both our internal dispute resolution process your complaint and a way to contact them. and external dispute resolution provider will comply with ASIC guidelines. Responding to your complaint
We will publicise our dispute resolution 203. When we have completed our processes investigation, we will provide you a written response, which will include: 197. We will publish, and make readily available, information about our internal dispute a) the outcome of our investigation of resolution processes and our external dispute your complaint; resolution provider through: b) your right to take your complaint a) our branches; to our external dispute resolution provider; and b) our telephone banking services; and c) the name and contact details of our c) our websites or other digital platforms. external dispute resolution provider. Farm debt mediation 198. Before we enter into a farm debt mediation with you, we will inform
52 53 Timeframes for handling your complaint Members of BCCC c) as appropriate, investigate serious or BCCC Powers and Sanctions systemic breaches; 204. If we resolve your complaint to your 208. The independent BCCC, established under 214. The BCCC has the power to apply sanctions satisfaction within five business days, we this Code, is comprised of the following d) request information from subscribing to a Code subscriber for a breach of this do not need to provide you with a written members: banks and other stakeholders; Code where a finding has been made that: response as outlined in paragraph 203, a) the breach is serious or systemic; unless you ask us. This does not apply a) an independent chairperson - appointed e) make findings and recommendations on jointly by AFCA and the ABA; and Code breaches; to a complaint relating to hardship, b) the bank has failed to act on the a declined insurance claim or the b) a consumer representative – appointed f) apply sanctions; BCCC’s request to remedy a breach, or value of an insurance claim. by consumer representatives on the Board failed to do so within a reasonable time; of AFCA; and g) provide guidance and reports; and 205. If we are unable to resolve your complaint c) there has been a breach of an within 21 days, we will tell you that we need c) a banking representative – appointed by h) undertake other functions and undertaking given to the BCCC; more time to investigate the complaint. the ABA. responsibilities as reasonably determined from time to time. d) the bank has not taken adequate steps 206. If we are unable to resolve your complaint The BCCC acting unanimously will appoint, to prevent a serious or systemic breach within 45 days, we will: on terms it thinks appropriate, In addition, the BCCC will endeavour to: from reoccurring; or a person or a panel of persons, with a) tell you the reasons for the delay; i) drive improvements in compliance with e) the bank has not co-operated and expertise in small business and/or the Code to achieve best practice; and complied with reasonable requests of b) tell you the date by which you can agribusiness to act as a consultant on small the BCCC in the performance of its reasonably expect to hear the outcome business and agribusiness issues. The ii) promote awareness of the Code monitoring and investigative activities. of our investigation; and consultant will provide advice on small and the role of the BCCC through business/agribusiness matters where engagement with key stakeholders. 215. The BCCC may impose one or more c) give you monthly updates on the progress; requested by the BCCC. sanctions after considering the seriousness and When the BCCC is undertaking its of the breach. Sanctions available to the investigation function it will prioritise d) provide you with the name and contact BCCC are: its efforts on monitoring and public details of our external dispute resolution You can contact the BCCC about assurance. Prioritising investigative effort will a) requiring the bank to rectify or take providers. a breach of this Code have regard to factors such as: number of corrective action on the breach However, we do not have to keep you 209. If you want to report an alleged breach of customers affected, severity of breach and identified; informed in this way if you have not this Code you can contact the BCCC. public interest. b) requiring a bank to undertake a responded to requests for additional 210. If you have a specific dispute with your compliance review of our remediation information from us, and your non-response bank that involves a breach of this Code, BCCC resources actions; is preventing us from dealing with your you should contact your bank in the first complaint. 212. The ABA will ensure that the BCCC has instance, and then your bank’s external c) formally warning a bank; sufficient resources and funding to carry dispute resolution provider. out its functions. More information on the d) requiring a bank to undertake a staff BCCC is available in its charter on the training program on the Code; CHAPTER 49 BCCC website. e) naming a bank in the BCCC annual Powers and role of the BCCC Code monitoring, complaints report or website; and and sanctions 211. In relation to the Code, the BCCC has the We will comply with requests of the BCCC following powers: f) reporting serious or systemic ongoing 213. We will co-operate and comply with all instances where a bank has been Code complaints, monitoring a) monitor and oversee compliance with reasonable requests of the BCCC in the non-compliant to ASIC. and sanctions the Code; performance of its monitoring and 207. We have established an independent code investigative activities. b) investigate any allegation of a Code monitoring body, the Banking breach noting its priority pursuant to its Code Compliance Committee (BCCC), charter; to monitor our compliance with this Code.
54 55 Acronyms Definitions
ABA The incorporated entity named Australian Banking Association ‘the Code’ The 2019 Banking Code of Practice as published by the ABA at or by an approved change of name the commencement date.
ACCC Australian Competition and Consumer Commission Asset finance Financial accommodation provided by us:
AFCA Australian Financial Complaints Authority (a) for the acquisition, lease, rental, hire purchase or otherwise of a tangible asset that is not land; and/or
ASIC Australian Securities and Investments Commission (b) to fund the payment of any insurance products acquired in connection with that asset. ATM Automatic teller machines Australia Includes the coastal sea of each jurisdiction but does not BCCC Banking Code Compliance Committee include an external territory.
BSB Bank State Branch Bank Means a corporation authorised by law to carry on the general business of banking in Australia and that is authorised NCC National Credit Code under the Banking Act 1959 to use the word ‘bank’ or a similar expression in its name.
Card scheme Mastercard, Visa, eftpos, American Express, Union Pay or Diners Club.
Commencement date The date that we first subscribe to the Banking Code of Practice.
Commercial asset Asset finance provided by us to a business. financing
Commercial asset A guarantor that is a director, shareholder or manager of a financing guarantor company, that has provided a guarantee for the company’s commercial asset financing.
56 57 Complaint An expression of dissatisfaction made to us in relation Financial Counsellor “Financial Counsellor” means a financial counselling agency to a banking service, or the complaints handling process (including an organisation or individual) entitled to the itself, where a response or resolution is explicitly or benefit of an exemption under either the ASIC Corporations implicitly expected. (Financial Counselling Agencies) Instrument 2017/792 or ASIC Credit (Financial Counselling Agencies) Instrument 2017/793. Consumer credit Insurance that provides cover if you can’t meet the insurance repayments on your loan because you lose your job, The credit or financial accommodation provided to you under you are sick or injured, or you die. the banking service, including, but not limited to, credit facility, Loan credit contract, loan facility, home loan, personal loans, bill facilities, overdrafts, commercial asset finance. Days Calendar days.
A provider of goods and services. Default You are ‘in default’ if you fail to meet any of the terms and Merchant conditions of the contract. National Credit Code Means the National Credit Code set out in Schedule 1 of the National Consumer Credit Protection Act 2009. Default based action Exercising a legal or contractual right as a direct result of an event of default. Related entity As defined in section 9 of theCorporations Act 2001 (Cth). Device A device given by us to you that is used to perform a transaction. Examples include, ATM card, debit card or credit Security Includes, without limitation, mortgage of and a security card, contactless device. interest within the meaning of the Personal Property Securities Act 2009. Director guarantor A guarantor of a loan who is a director of a company which is to be the debtor for the loan. Sole director guarantor A guarantor of a loan who is a director of a company that has only one director, and that company is to be the debtor for the loan. Dispute Has the same meaning as complaint.
Fees and charges normally charged by us in respect of a eftpos Proprietary or domestic debit cards managed by eftpos Standard fees and Payments Australia Limited. charges banking service.
Terms and conditions specifically applied by us to a banking Enforcement For a small business: Terms and conditions service, but does not include any other terms and conditions proceedings a) commencing proceedings in a court to recover a debt that may apply by operation of law. or to recover possession of property subject to security; or
b) otherwise enforcing security by taking possession Trustee guarantor A guarantor of a loan where the guarantor and the debtor are (or seeking to take) of security property, exercising the same person, and that person is acting as trustee of a trust a power of sale over security property, appointing in one of these roles and is acting in their personal capacity in receivers or receivers and managers, appointing the other role. voluntary administrators, or making application to a court for the appointment of provisional liquidators or the appointment of a trustee in bankruptcy; or
c) enforcing a judgment against you, a guarantor, or your or their assets.
58 59 Unauthorised A transaction that is not authorised by you. transaction
Vehicle asset financing Asset finance provided by us to an individual that is not a Transitional period business, in relation to a motor vehicle and/or any related insurance products. For the purpose of this section the transition date means 1 March 2020. Release 1 means the Banking Code of Practice 2019 released 1 July 2019. Vehicle asset finance A guarantor who has provided a guarantee for the vehicle guarantor asset finance of an individual that is not a business.
Application to Banking Services Application to guarantees This Code will apply to every banking service This Code will apply to every guarantee which for which you enter into an agreement with us you enter into on or after the transition date. on or after the transition date. For guarantees that you entered into before For ongoing banking services that we were the transition date or where documentation providing you as at the transition date or was sent to you before the transition date: where documentation was sent to you before the transition date: a) the terms and conditions of that guarantee need not comply with a) the terms and conditions of that banking this Code, and will continue to apply service need not comply with this Code, even if they are inconsistent with this and will continue to apply even if they are Code. If we provide you with revised terms inconsistent with this Code. If we provide and conditions after the transition date, you those revised terms and conditions will with revised terms and conditions after the comply with this Code; transition date, those revised terms and conditions will comply with this Code; b) if after the transition date we ask you to increase the limit of your guarantee, we will b) this Code applies where it relates to matters comply with the relevant provisions of this that are not specifically dealt with in the Code; terms and conditions of that banking service; c) this Code applies where it relates to matters that are not specifically dealt with in the c) this Code does not affect things we did in terms and conditions of that guarantee; relation to that banking service before the transition date. If our banking service d) this Code does not affect things arrangements with you as at the transition we did in relation to the guarantee before date complied with Release 1, or with the the transition date. If our guarantee 2013 Code as contemplated by Release 1, arrangements with you they will continue to comply with this Code as at the transition date complied with even if this Code would have required Release 1 or with the 2013 Code as something to be done differently. contemplated by Release 1, they will continue to comply with this Code even if this Code would have required something to be done differently.
2013 Code The 2013 Code or Release 1 will not apply to any banking service or guarantee to the extent that this Code applies.
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