New Banking Codes

The new Business Banking Code and the Banking Code were published at the start of April, together with guidance and a fact sheet giving the key new provisions.

The Codes have been given a bit of “press”.  Radio 4’s Moneybox Live had Eric Leenders, head of the Retail team at the British Bankers’ Association on to explain the changes.  The BBA’s view is the Codes have been received posititively by consumer organisations and the press.  The committment by the banks to contact customers who are getting into financial difficulty is thought particularly helpful.  Anyone want to disagree?

New provisions added to the Codes include:

• A requirement to lend responsibly (added to the fairness commitment in section 2 of the Banking Code and Business Banking Code).
• More stringent guidelines for credit assessments (the Banking Code).
• A requirement that banks provide customers with a summary of important information about unsecured loans and savings accounts before customers purchase a product.  This will apply from 1 October 2008 (the Banking Code).

Banking Code Standards Board: http://www.bankingcode.org.uk/home.htm

Eric Leenders: http://www.bba.org.uk/bba/jsp/polopoly.jsp?d=153&a=8077