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This new code of practice (the Code) aims to enhance protections for customers who are placed in vulnerable positions due to elder abuse, domestic violence and disability.
Earlier this year, COBA introduced 10 new obligations in relation to the identification and treatment of customers experiencing vulnerability.
The changes included taking “reasonable steps” to make banking services more accessible for customers who speak English as a second language, elderly customers, people with disabilities and First Nations Peoples.
The changes followed a report conducted by the independent committee that monitors the Code, which pushed for a “sharper focus” on customers experiencing domestic violence or elder abuse, in particular.
Replacing the 2018 version, the new 2022 Customer Owned Banking Code of Practice was developed through an independent review by the former executive general manager of Australian Securities and Investments Commission, Phil Khoury.
The new Code was considered by the Code Review Committee members and was adopted by the Customer Owned Banking Association (COBA) board.
In conjunction with ongoing commitments to produce and deliver banking products in the interest of customers and to give back to the community, the new Code will establish obligations for more inclusive banking products, expanded lending obligations and guarantor protections along with more support for vulnerable customers.
CEO of COBA, Michael Lawrence, stated that the focus on providing more support for vulnerable customers is important now more than ever due to rising cost of living, consumer habits changing with technology and new purchasing options.
“Customer-owned banks serve more than five million Australians and are committed to ensuring customers have access to services that are built on a deep appreciation of nuanced vulnerabilities or financial challenges.
“We appreciate the contributions of the many stakeholders involved in the review process, including consumer groups, regulators, the Code Compliance Committee, consultants and member banks,” Mr Lawrence said.
ABA responds to the BCCC review
As well as the new COBA code coming into being, the Australian Banking Association (ABA) recently responded to recommendations from the Final Report of the Independent Review of the Banking Code Compliance Committee (BCCC) of Practice 2021.
ABA CEO Anna Bligh said that ABA is in support of the majority of the recommendations from the Banking Code Compliance Committee (BCCC) review, especially the transition to improved transparency on bank compliance with the Code through a naming regime.
“We think this is beneficial for lifting industry standards even higher.”
The ABA has accepted eight out of the nine recommendations within its remit including:
- Recognising and further promoting the dual role of the BCCC in both monitoring compliance and promoting industry best practice;
- Enhanced representation of small business and faming sectors in the BCCC’s work;
- Enhanced powers to report serious or system issues to ASIC; and
- Enhanced powers to consider Code breach matters beyond 2 years or, where another forum has made no finding in relation to a Code breach.
Regarding the one recommendation not supported (recommendation 17 that banks named by the BCCC for serious breaches also publish this fact on their own website) Ms Bligh said “the BCCC has existing powers to publicly name banks that have breached the Code without the need for Banks to repeat this information on their own websites.”
“While there is further work to do to address consistency in reporting and benchmarking to get ready for such a change, the ABA looks forward to working with the BCCC and other industry stakeholders on this objective,” Ms Bligh said.
[RELATED: COBA includes vulnerability obligations to its code]
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