Banks to make life ‘easier’

BANKS will stop offering unsolicited credit card increases and let customers cut their cards off online as part of a major overhaul of the nation’s banking industry.

A banking code of practice, to be released today, contains dozens of new rules which the banks argue will make life easier for consumers and businesses and better protect them from financial trouble.

Under the changes, paper statement fees will be waived for people who can’t access their bank statements online.

Shoppers will benefit from new rules on credit card interest payments, with banks no longer able to charge interest on the full amount of a purchase once the interest-free period has expired, if part of the purchase has already been paid off.

The code of practice — which is expected to be implemented next year — means transaction fees will be detailed more transparently and plain English contracts will be introduced for businesses.

Banks will also have to provide consumers with detailed lists of their direct debits, to easily figure out where their money is going, and switch accounts without failing to keep up with payments.

The new code, developed by the Australian Bankers’ Association after an independent review earlier this year, must now be ticked off by the Australian Securities and Investments Commission.

The consumer-friendly changes come as the banking sector faces a Royal Commission into its practices next year after months of political pressure from Labor and several rogue Nationals MPs.

ABA chief executive Anna Bligh said the new rules would “go a long way in addressing the expectations that Australians have of their banks”.

“The new code means we are making banking easier, by making changes to processes, providing customers with more info and introducing higher standards for how banks serve their customers,” Ms Bligh said.