Recent changes to the Banking Code should mean that consumers get a fairer deal from big banks. But critics say the overhaul should be more far-reaching. Jo Thornhill addresses the main issues.
Does the code go far enough to protect consumers?
Consumer lobby group Which? believes more could have been done to benefit consumers.
For example, the minimum monthly payment on a credit card must now cover interest and some of the outstanding balance so that cardholders chip away at the debt.
But Vera Cottrell, principal policy adviser at Which?, would have liked to have seen a bigger increase in the minimum repayments on credit cards.
Credit card and loan comparison website uSwitch.com also believes the code has room for improvement.
Though it will now be compulsory for providers to carry out credit reference agency inquiries alongside one of three other financial checks, uSwitch does not think it will be enough.
Mike Naylor at uSwitch says: 'It is essential that lenders take into account income and existing loan commitments and consider future affordability. While the credit crunch has forced lenders to tighten criteria, the new code does not go far enough to help promote responsible lending.'
I think my bank has broken the code. How do I complain?
First contact your provider. Consumers can get a copy of the code from the Banking Code Standards Board at banking code.org.uk.
If you do not get a satisfactory resolution, take your grievance to the Financial Ombudsman Service. It will review your case, taking into account any breaches of the code. |
