Federal Register of Legislation - Australian Government

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A Bill for an Act to amend the Banking Act 1959 and the National Consumer Credit Protection Act 2009 to improve basic banking services, and for related purposes
For authoritative information on the progress of bills and on amendments proposed to them, please see the House of Representatives Votes and Proceedings, and the Journals of the Senate as available on the Parliament House website.
Registered 24 Aug 2011
Introduced HR 22 Aug 2011
Table of contents.

2010‑2011

 

The Parliament of the

Commonwealth of Australia

 

HOUSE OF REPRESENTATIVES

 

 

 

 

Presented and read a first time

 

Banking and Consumer Credit Protection Amendment (Mobility and Flexibility) Bill 2011

 

No.      , 2011

 

(Mr Bandt)

 

 

 

A Bill for an Act to amend the Banking Act 1959 and the National Consumer Credit Protection Act 2009 to improve basic banking services, and for related purposes

  

  


Contents

1............ Short title............................................................................................. 1

2............ Commencement................................................................................... 1

3............ Schedule(s)......................................................................................... 1

Schedule 1—Amendment of the Banking Act 1959                                          1

Schedule 2—Amendment of the National Consumer Credit Protection Act 2009            1

 


 

 

 

 

A Bill for an Act to amend the Banking Act 1959 and the National Consumer Credit Protection Act 2009 to improve basic banking services, and for related purposes

The Parliament of Australia enacts:

1  Short title

                   This Act may be cited as the Banking and Consumer Credit Protection Amendment (Mobility and Flexibility) Act 2011.

2  Commencement

                   This Act commences on the 28th day after this Act receives the Royal Assent.

3  Schedule(s)

                   Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


 

Schedule 1Amendment of the Banking Act 1959

  

1  At the end of subsection 9(4)

Add “or the requirements of sections 9AG and 9AH”.

2  After section 9

Insert:

9AG  Variation of conditions of authorities—switching services

             (1)  APRA must, within 30 days of the commencement of this section, vary the conditions of existing section 9 authorities to give effect to this section and any new section 9 authority granted after that commencement must include conditions that give effect to this section.

             (2)  A section 9 authority must require an ADI to offer a switching service to personal account holders.

             (3)  If a personal account holder advises the ADI (the old ADI) at which he or she has one or more transaction accounts that he or she is transferring those accounts to another ADI (the new ADI), the new ADI’s switching service must arrange for all direct debits and direct credits made in relation to the personal account holder’s transaction accounts with the old ADI to be made instead in relation to the personal account holder’s transaction accounts with the new ADI.

             (4)  The old ADI must:

                     (a)  provide the new ADI with all the information necessary to comply with subsection (3); and

                     (b)  otherwise facilitate the transfer of the personal account holder’s transaction account or transaction accounts by all reasonable means.

             (5)  In this section:

direct credit means a credit payment made by a third party to a nominated transaction account in accordance with instructions provided to the third party by the person who is the account holder of the transaction account.

direct debit means a debit payment drawn by a third party from a nominated transaction account in accordance with instructions provided to the third party by the person who is the account holder of the transaction account.

switching service means the service provided by an ADI to:

                     (a)  personal account holders who wish to transfer their transaction accounts to another ADI; and

                     (b)  personal account holders who have transferred their transaction accounts from another ADI.

9AH  Variation of conditions of authorities—term deposits

             (1)  APRA must, within 30 days of the commencement of this section, vary the conditions of existing section 9 authorities to give effect to this section and any new section 9 authority granted after that commencement must include conditions that give effect to this section.

             (2)  A section 9 authority must require an ADI that offers term deposits to give written notice of the following to the holder of a term deposit at least 15 working days before the end of the term:

                     (a)  the interest rate and the term that will apply if the money in the term deposit is automatically reinvested at the end of the current term; and

                     (b)  any special term interest rates, special interest rates or additional bonus interest rates that are available from the ADI at that time.

The information required by paragraphs (a) and (b) must be set out clearly and prominently on the notice.


 

Schedule 2Amendment of the National Consumer Credit Protection Act 2009

  

1  After subsection 17(4) of the National Credit Code

Insert:

Unjust transactions and unconscionable interest and other charges

          (4A)  The contract document must contain information that expressly advises the debtor of the provisions of this Code that relate to review of:

                     (a)  unjust transactions; and

                     (b)  unconscionable interest and other charges;

and the debtor’s rights under those provisions.

2  After subsection 17(15) of the National Credit Code

Insert:

Information about recovery of insurance premiums

        (15A)  If the credit provider knows that a related insurance contract of a kind mentioned in section 147A, 148 or 149 is being entered into, the contract document must expressly advise the debtor of the debtor’s rights under those sections.

3  After section 147 of the National Credit Code

Insert:

147A  Termination of mortgage indemnity insurance contract if credit contract terminated

             (1)  On termination of a credit contract, any mortgage indemnity insurance contract relating to the contract in force is also terminated.

             (2)  Within 28 days after a mortgage indemnity contract is terminated by the operation of subsection (1), the credit provider must pay the debtor or, credit the debtor with, a rebate of premium paid under the contract.

             (3)  The amount of the rebate must be an amount worked out in accordance with the regulations. The regulations must provide for actuarially fair amounts of rebate.

             (4)  The credit provider may, in turn, recover from the amount of the rebate from the insurer.

             (5)  This section has effect despite any provision of the mortgage indemnity insurance contract.

4  Subsection 149(1) of the National Credit Code

Repeal the subsection, substitute:

             (1)  If a credit contract is terminated before the end of its term, the debtor is entitled to terminate any credit‑related insurance contract over mortgaged property in force, whether financed under the credit contract or by other means, and recover from the insurer a proportionate rebate of premium paid under the insurance contract.