The BCCC has published a Guidance Note on clause 10 of the Banking Code of Practice – banks’ obligation to engage with customers in a fair, reasonable and ethical manner.
Clause 10 is one of the Code’s most important obligations and should be embedded within banks’ internal culture to ensure they meet the BCCC’s expectations – to act fairly, reasonably and ethically in all circumstances.
There has been increased focus on ‘fairness’ in the financial services industry and its importance has been recognised as being key to meeting community expectations. The BCCC notes fairness was highlighted as one of Commissioner Hayne’s six underlying principles during the Financial Services Royal Commission, the Australian Financial Complaints Authority (AFCA) is developing a fairness framework, the Australian Securities and Investments Commission overlays the ‘fairness imperative’ in its work and consumer groups continue to advocate for the prohibition of unfair practices.
The Guidance Note highlights that clause 10 is a broad obligation and extends to the design of banks’ products and services, marketing and sales practices, processes and policies. In accordance with clause 9 of the Code, banks must ensure staff are supported and trained to competently comply with clause 10. Banks must identify, investigate and fix any breaches of the fairness obligation and report them to the BCCC.
The BCCC consulted with banks, consumer groups and AFCA when developing the Guidance Note and thanks all parties for the valuable feedback provided.