Australian banks will no longer be allowed to charge dead people for services not rendered, under new industry rules starting on Monday.
The Australian Securities and Investments Commission this week approved the new version of the Australian Banking Association's code of conduct to take effect from July 1.
One of the major changes is charging fees to deceased customers, which was a topic raised last year during the finance industry Royal Commission.
ASIC announced that the changes "put beyond doubt that a bank will not charge fees for services to deceased customers, where services are no longer being provided to that customer's estate".
Other amendments coming into effect include those relating to valuations to small business customers and new credit card responsible lending rules.
Australian banks are required to follow the code to retain their ABA membership, with the code contents contributing to the financial firms' contract with their customers.
The July 1 changes are the first stage of reforms, with the second stage scheduled to take effect on March 1 expected to address the recommendations coming out of the Royal Commission.
Those amendments could include protections for "vulnerable" customers and reform in the way banks charge default interest on farmers in the wake of natural disasters.
The ABA currently has 23 members including all four of the major banks – CBA, Westpac, ANZ and NAB – plus other big brands like Citi, HSBC, ING, Macquarie, ME, Suncorp and AMP.
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