Toowoomba customers protected by new rule book for banks

The Australian Banking Association has today partnered with Toowoomba Chamber of Commerce to brief the local business community and stakeholders on the new rule book for banks, the new Banking Code of Practice, and the ‘financing your small business’ website.

In force since July 1 this
year, the new ASIC approved Banking Code of Practice contains a big step up in
protections for customers.

Under
the new Banking Code of Practice, banks no longer:

• Offer unsolicited credit card limit increases
• Charge commissions on Lenders Mortgage Insurance
• Sell insurance with credit cards and personal loans at the point of sale.

Under
the Code banks must:

• Offer low-fee or no-fee accounts to low income customers
• Have a 3 day grace period on all guarantees to give guarantors enough time to make sure it’s the right option for them
• Actively promote low-fee or no-fee accounts to low income customers
• Provide reminders when introductory offers on credit cards end
• Provide simpler and fairer loan contracts for small business using plain English that avoids legal jargon
• Provide customers a list of direct debits and recurring payments to make it easier to switch banks.

The ABA will also brief the
business community on the new ‘financing your small business’ website designed
as a ‘step by step’ guide on applying for finance.

CEO of the Australian Banking Association Anna Bligh is in Toowoomba and will address a business breakfast on the new Code and the ‘financing your small business‘ website to brief the local community on how it can benefit them.

“Local businesses are the lifeblood of towns like Toowoomba, providing jobs and services across the community,” Ms Bligh said.

“Banks
have listened to community concerns and released a new rule book for banks, the
Banking Code of Practice, which is a major step up in protections for
customers.

“Today
was also an important opportunity to hear from local businesses directly as
there’s no substitute for talking face to face and hearing about issues first
hand,” she said.

President of the Toowoomba
Chamber of Commerce, Joy Mingay, said the Code of Practice was particularly
important for local small businesses who would receive greater
protections.

“Our Chamber has long been
known as the ‘voice for business’ in Toowoomba and we are delighted to have
hosted Anna Bligh for an update on how the new Banking Code of Practice will
impact business in our region,” Ms Mingay said.

“We are excited to see the
new Code contain a dedicated small business section which will see business
contracts simplified, loan conditions fairer and small business customers given
a longer notice period should loan conditions change.

“We’d like to thank Anna
Bligh for making the visit to our region and all her hard work in establishing
this improved commitment,” she said.