We are consulting with key stakeholders on the draft Guidance Note 4 – Closure of accounts in credit.

The consultation will run from 2 May 2024 until 13 June 2024.  We invite stakeholders to provide feedback by email to [email protected].

We will aim to finalise the Guidance Note 4 in August 2024.

Questions for stakeholders

We welcome your general feedback on the draft Guidance Note 4. In particular, we seek responses to the following questions:

    1. Does Guidance Note 4 achieve its intended purpose to clarify the Banking Code of Practice (the Code) requirements and improve customer outcomes? Please provide reasons for your answer.
    2. What other details should be included in Guidance Note 4? Please provide reasons for your answer.
    3. What other reasons are there for a bank to not provide notice of account closure to customers which should be included in paragraph 4?
    4. In the proposed Code, paragraph 143 is referenced at paragraph 40 has been amended as below:

40(b). will, if appropriate, pay you the amount of the credit balance (for example where we have your payment account details).

The proposed amendment recognises, through the use of ‘if appropriate’, that there may be circumstances in which a bank ought to be exempted from paying the available credit balance to customers.

In what circumstance do you consider it appropriate for a bank to withhold the available credit balance on the account?


Paragraph 143 of the the Code offers protections to customers when a bank initiates closure of a customer’s account that is in credit. Paragraph 143 states:

We may close an account of yours under its terms and conditions if that account is in credit. If we do so, we:
a) will, if appropriate, give you reasonable notice of the closure;
b) will pay you the amount of the credit balance; and
c) may charge you an amount that is our reasonable estimate of the costs of closing your account.

Currently, outside of the Code, there are no other protections, available to customers when a bank initiates closure of a customer’s accounts.

Further guidance is needed to clarify ambiguous phrases in paragraph 143 to ensure a consistent interpretation and application among banks.

We have developed the draft Guidance Note 4 to:

  • set out our view of what banks should do to comply with their paragraph143 obligations,
  • set out the standards we expect banks to meet, and
  • recommend steps banks should take to achieve better practices, which in some cases may extend beyond the strict requirements of the Code.

While acknowledging that the Australian Securities and Investments Commission’s review of the Code may lead to changes in certain Code obligations, we believe that Guidance Note 4 will remain relevant following completion of the review.