Chair’s message

In this report, we evaluate how banks are meeting their promises to customers, especially in these challenging times, marked by cost-of living pressures. We highlight several areas that require ongoing attention and improvement.

Banks are making efforts to enhance their complaints handling processes and some have made positive progress. However, some banks continued to struggle to meet their complaints handling obligations. In this period, we saw a 58% increase in these type of breaches. The breaches commonly related to timely responses and clear communication.

Fair, timely, and effective dispute resolution underpins the relationship between the bank and customer. We want to see a focus on improving compliance with complaints handling timeframes, to ensure complaints are managed promptly and to avoid any unnecessary stress for the customer.

We also saw an 11% increase in breaches of the obligations relating to how banks communicate with customers. This follows a consistently high number of communication breaches reported over the last two years.

We saw instances of banks not reporting critical information to customers, such as accurate details about financial hardship arrangements, clear guidance on navigating scams, and correct information on fees and charges.

We want to see consistency in banks’ effective communication to ensure customers are well-informed and supported, particularly during periods of hardship.

We are also concerned by what appears to be a disparity in customer outcomes between unrepresented and represented customers, for example by a financial counsellor. Banks must ensure that all customers receive fair and consistent treatment, regardless of whether they have a specialist representative.

Finally, in our last report, we called out the increase in breaches of the financial difficulty obligations. We saw improvement in some areas, including a 25% decrease in breaches of the obligations relating to when customers contact the bank when experiencing financial difficulty.

However, there was a 25% increase in breaches of the obligation to provide assistance to customers in financial difficulty. When customers reach out for hardship assistance, it is critical that banks get the response right. The increases observed were not across all banks, which suggests that some banks are doing better than others. We expect to start seeing improvement in banks supporting customers in financial difficulty following the spotlight of this issue through ASIC’s work and our own reporting.

We remain committed to working with the industry to improve banking standards and customer care for all banking customers.

Ian Govey AM
Independent Chairperson
Banking Code Compliance Committee