What's in the banking code and why should you care. Amanda Morrall talks to Kirk Hope from the NZ Bankers' Association

By Amanda Morrall

It may never rival the popularity of the Da Vinci Code, but there is good reason why everyday banking customers will want to read the Code of Banking Practice.

For example: did you know that if you do not take "reasonable" steps to make sure you have appropriate security systems installed on your computer that any financial losses resulting from an internet security breach are yours alone to absorb.

Or that having a obvious pin number ( ie. 22222 or 54321) or a password that could be easily guessed (ie. street address, birth date or pet) that you're also liable for your own financial misfortunes if internet hackers or anyone else gets hold of your digits.

Read the code. It may not make for exciting bed time reading, but it could make all the difference in the event of a security breach.

The New Zealand Bankers' Association, which released an updated version of the 1992 Code on Friday, contains a number of conditions and provisos relevant to today's modern banker..

Kirk Hope, chief executive for the NZBA, said the contents of the code (covering everything from foreign exchange rates to mobile banking phone apps) were relavent to anyone with an established banking relationship.

Hope said there were four additions and updates that customers should take note of:

  • mobile phone banking;
  • the dispute resolution process;
  • accessibility of the Code;
  • focus on retail customers.

With the rise of mobile phone banking, the Code provides some guidance on how to minimise security breaches. The two main recommendations are: 1) putting a lock on your smart phone to protect confidential information if it is stolen or lost. 2) closing down any banking applications once you're done to reduce the likelihood of being phished (where a key stroke logging programme or virus burrows into your account details from another programme).

Another change relates to the advent of the dispute resolution schemes where customers can take up any complaints they might have with their bank.The dispute resolution schemes are a relatively new recourse for bank customers who previously had to rely solely on the Banking Ombudsman for any grievances they wanted addressed. Each member of the Financial Services Provider Registry is required

The third aspect of the Code relates to its accessibility in order to draw greater attention to it among customers. The 13 banks who are members of the association will post it to their websites and make hard copies available at their branches. The document is also available on the NZBA's website.

And finally the Code, through the exclusion of wholesale customers from its target audience, wants to reaffirm its focus on the retail sector.

"We're just making the code really explicit about the retail focus.''

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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1 Comments

Who doesn't know the banking code!
Seek out fat profits from selling mortgage credit to peasants who have no concept of the pitfalls or pain they will suffer and do it with the backing of the RBNZ and govt.
Ensure a deluge of blather and spin paints the bank as a friendly part of the peasant family life.
Spend lavishly on advertising in the poodle media to win the hearts and minds of the editorial staff.
Extract profits while paying as little tax as possible and bloat the salaries of the senior parasites and directors too..to ensure they play their part in the greater scam.
Always work to see the bank is woven into the social fabric of the country.
Seek out every corner of the economy where the credit printer can bring the greatest reward to the bank and
Do your utmost to discourage any understanding of why thrift and prudent financial peasant behaviour. especially the avoidance of mortgage debt, would lead to far greater wealth for all the fools.
Where possible, strive to blow property bubbles.