Big banks to get rid of bad business codes and other rules
BANKS WILL be getting rid of business codes as part of a $15bn initiative, following a government-led consultation that aims to make banks more transparent and more accountable.
The Government’s $15 billion Business Innovation Strategy is part of the Government’s response to the global economic crisis, which saw the banking sector become the subject of much criticism from consumers and policymakers alike.
The government said in its consultation document that while businesses needed to have clear and transparent code of conduct, there were a range of different standards that should be adopted by banks.
“In this context, the Government is calling on industry to look at the broad spectrum of standards to ensure that standards are not only relevant to the sector, but are also relevant to consumers and stakeholders,” it said.
“The Government is also calling on the sector to consider alternative standards to business code and other standards, such as the Public Sector Code of Conduct and the Banking Code of Practice.”
These changes will enable banks to become more transparent, more accountable, and better positioned to meet the needs of businesses.
“The Government said it would also consider changing some business code rules.
For example, it would consider the “business value” standard, which allows banks to decide whether to offer customers a particular kind of loan or credit product.
This would be subject to a review by the Competition and Consumer Commission.
Banks will also be required to post information on their website about how many people have been affected by the code of practice and how many banks were able to respond to a complaint.”
We have identified a number of areas in which this information could be helpful to customers, and we have made it available online,” the Government said.
It said the Government was also calling for the banking industry to develop a common code of practices to guide the way banks conduct business and to help protect customers’ money.
It also said the banking regulator would be required “to develop guidelines and other information to help ensure the financial services industry is transparent, accountable and in line with current best practice”.
The consultation document said the government would consult with the banking, insurance and pension sectors on the proposals.”
As part of our response to this global crisis, we are looking at how to ensure we are meeting the needs and expectations of our businesses, our consumers and our communities,” the document said.
The banking industry said the change to business codes would help make banks less vulnerable to predatory behaviour and to improve the way they responded to consumer complaints.”
It is vital that the sector is open to all businesses and that businesses are able to compete, and that the code remains relevant and relevant to our business,” said John Hutton, the chief executive of the Financial Services Association.”
Consumers are entitled to trust in the integrity of the code, and it is critical that we can take steps to keep them safe from unscrupulous conduct.