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Sydney, October 18, 2002: The Australian Bankers’ Association (ABA) said despite the increase in Australian Banking Industry Ombudsman (ABIO) cases, there was an improved resolution rate for bank customers.
Speaking after the release of the ABIO’s annual report 2001-2002, David Bell, Chief Executive of the ABA, said: “While there was a 12.5% increase in cases compared to the previous year, 88% of cases were resolved by the banks after referral by the Ombudsman’s office which illustrates continuing improvement in the banks’ internal dispute resolution processes.”
The increase in ABIO cases reflects:
1. the growth in the banking market;
2. the increase in the volumes of banking transactions;
3. the larger customer base because small business has been incorporated into the scheme;
4. increased public awareness of the Ombudsman’s services;
5. two atypical events that created many enquires about credit cards;
- the corporate collapse of Ansett which led customers to seek clarification on refunds of tickets bought on credit cards;
- the corporate collapse of OneTel which led customers to seek information on the process to follow when cancelling direct debits.
Mr Bell said: “I note that there is a very low incidence of credit card cases when you compare the number of ABIO cases with the number of transactions. Out of 796 million credit card transactions, there were only 1481 credit card ABIO cases.”
Mr Bell said the new Code of Banking Practice is a clear signal to bank customers that banks are continuously trying to lift their standards.
“Not only has the Code of Banking Practice recently been reviewed and revamped, but it will also be independently monitored. Banks that adopt the new Code will be accountable, and publicly named if found to be seriously or systemically in breach,” he said.
The new Code of Banking Practice contains principles of best practice conduct across a range of areas which are dealt with by the ABIO including:
· Consumer Finance - unauthorised transactions and incorrect debits to credit cards - consumers will get information about chargebacks that can quickly reverse these types of transactions;
· Other accounts - there is the principle to act fairly and reasonably in dealings with customers in a consistent and ethical manner;
· Payments system - there are explicit rules about cancellation of direct debit authorities and processsing of complaints about unauthorised transactions to debit accounts;
· Internal Dispute Resolution – there are more rigorous procedures for the benefit of bank customers including notification and availability of information;
· Guarantees - provision of important and relevant information for prospective guarantors before they commit to guaranteeing someone else’s debt;
· Staff Training – banks to ensure staff are trained to competently and efficiently discharge their authorised functions.
Mr Bell said banks that have adopted the original Code (1993) will adopt the new Code in August 2003, unless a bank indicates to the contrary. Banks that are not members of the ABA are free to adopt the Code if they so wish.
For further information contact:
Heather Wellard
ABA PR
Phone: 02 8298 0411
Mobile: 0409 830 439
Notes for editors:
· The Australian Banking Industry Ombudsman scheme was set up in 1990 to help individual bank customers sort their unresolved complaints with their banks. Since then, the Code of Banking Practice has been introduced.
· The Code of Banking Practice requires the banks to provide personal customers with a free, external and independent process for resolving disputes and has been expanded to cover small business.
· The original Code of Banking Practice was introduced in November 1993, to set standards of good practice which guide banks in their relationships with their personal customers.
· For the new Code, there will be a Monitoring Committee which will report on compliance with the Code, conduct its own investigations, request banks to remedy breaches of the Code and in certain cases publicly name a non-compliant bank. |