Executive summary

In 2020, the Banking Code Compliance Committee (BCCC) commenced an Inquiry into banks’ compliance with Part 4 of the Banking Code of Practice (the Code).

Part 4 of the Code contains key obligations requiring that all people, irrespective of their circumstances, experience fair outcomes from their Code-subscribing bank (bank).

Failure to comply with these obligations can have devastating impacts on customer wellbeing. The Banking Royal Commission highlighted harms experienced by customers in vulnerable circumstances due to poor industry practice and misconduct.[1]

Consumer advocates shared recent examples of customers’ needs not being met, including cases of domestic violence involving breaches of privacy, ongoing inclusivity barriers experienced by non-English speaking customers, Aboriginal and Torres Strait Islander people living in remote communities being asked to travel hundreds of kilometres to the nearest branch for identification purposes, and people on a low income not being told about their eligibility for a basic, no or low fee transaction account.

Banks are in a prime position to identify customers at risk of poor outcomes and ensure their staff, processes, systems, products and services enable the delivery of fair outcomes for all customers.

Overall, the BCCC found that:

  • banks have invested significant resources to advance their capability to support customers experiencing vulnerability and to deliver more inclusive and accessible products and services.
  • the level of progress across industry is inconsistent and further work is needed to ensure that customers experience fair outcomes irrespective of their bank.
  • while positive initiatives have been implemented, there are gaps in staff awareness and service delivery.
  • compliance monitoring frameworks are not adequate to assess front-line staff adherence to Part 4 of the Code.

The Inquiry commenced after the onset of the COVID-19 pandemic. Many people, including small business owners, face ongoing hardship in an uncertain environment – with disproportionate economic and social impacts on some members of our community. Customers face higher rates of scams and fraud, incidents of domestic and family violence, mental health concerns, and new inclusivity and accessibility barriers. Banks have had to rapidly adjust to new ways of working.

In this environment, it is imperative banks uphold their commitments under Part 4 of the Code. The BCCC expects banks to build on the progress made so far and carefully consider the recommendations and good practice in this report to inform their strategies and deliver fair outcomes for all customers. The BCCC also acknowledges that good practice is continually evolving and that our recommendations on best practice may change over time too.

[1] Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

What we did

  • We collected and analysed qualitative data from banks.
  • We conducted a consumer advocate survey and received 40 responses from financial counsellors and community legal centres about banks’ current practices.
  • We collected and analysed individual case studies from community legal centres and reviewed submissions made to the 2021 Code review.
  • We analysed banks’ websites to assess whether information about available support is clear and easily accessible.