Banks change small busi­ness loan con­tract rules

Australian Transport News - - News -

The Aus­tralian Small Busi­ness and Fam­ily En­ter­prise Om­buds­man (ASBFEO) and the Aus­tralian Se­cu­ri­ties and In­vest­ments Com­mis­sion (ASIC) have wel­comed new con­tract agree­ments from the ‘big four’ banks.

Na­tional Aus­tralia Bank (NAB), Com­mon­wealth Bank (CBA), Aus­tralia and New Zealand Bank­ing Group (ANZ), and West­pac (WBC) – the four big­gest banks in Aus­tralia – have agreed to elim­i­nate specic “un­fair” terms from small busi­ness loan con­tracts.

The four banks had ear­lier an­nounced plans to re­view their small busi­ness loan con­tracts.

Cus­tomers who en­tered or re­newed their con­tracts with the four banks from Novem­ber 12, 2016 will benet from the changes agreed with ASIC.

The Om­buds­man says the banks have acted on ASIC’s and ASBFEO’s calls to change their prac­tices.

While some of the agreed terms are “dif­fer­ent” to the orig­i­nal sug­ges­tion, ASBFEO Kate Car­nell com­mends the banks for, in some in­stances, go­ing fur­ther than what the law de­mands to ad­dress con­cerns about the clauses.

ASIC will mon­i­tor the ac­tual use of these clauses by the ‘big four’ banks to de­ter­mine if they are in fact ap­plied or re­lied on in an un­fair way.

ASIC and ASBFEO will as­sess the re­sults of this su­per­vi­sion.

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