JIS News

KINGSTON — Minister of Industry, Investment and Commerce, Hon. Karl Samuda, on April 19 unveiled a draft voluntary code of conduct for banking/financial institutions.

The code, which is being put forward for consideration for banks and other stakeholders, sets out standards of good practice that should serve as a guide for banks to follow when dealing with persons who are, or may become customers, in order to promote transparency.

Minister Samuda, who was addressing a press conference at his New Kingston office, said that countries, such as Canada, where these codes are put in writing and published, they serve as a basis on which to assess the level of efficiency of the banks, as they relate to the consumers that they serve.

He noted that the Ministry’s role, and that of consumer monitoring agencies, will be to monitor banks, and ensure that the public has an opportunity to assess the efficiencies of each institution. He noted further that the Consumer Affairs Commission (CAC) has a job to protect consumers, and the best way to do so is to make persons aware of the facilities that exist, and the degree to which they differ.

“So, it is one further step along the way of ensuring that the consumer gets the best possible deal – and in this instance, instead of devising methods by which we seek to bash the banks over their heads, the idea here is to work with a collaborative approach, where we will support the banks in their efforts to improve the relationship with their customers,” the Commerce Minister explained.

“I don’t want anyone to feel that this is an attempt in any way to impose on them anything that would be inimical to their interest,” he added.

The draft Code of Conduct was prepared by the CAC, and the National Consumers League (NCL).

Its key commitments are that all consumers should have equal right of access to service, provided by the banking institution, providing that the customer meets the entity’s requirements of access to the service being applied for.

It also states that the banks should display service standards at their branches and on their websites, as well as make copies available on request. This includes, but is not limited to: average waiting time in banking halls; response time to complaints or queries; and turnaround time for service application.
The characteristics of all products should be clearly explained to the consumers, including all related charges that exist or may be implemented.

Terms and conditions of contracts should be fair and set out both parties’ rights and responsibilities in plain and simple language, while legal and technical terms should only be used if necessary. The customer must be provided with a copy of the terms and conditions, and contract.

The consumer will have the right to review in detail, the following terms and conditions before engaging in any service of the banks: applicable ongoing fees and charges; additional fees and charges that may arise; the method by which interest is calculated; the number of installments that the consumer must pay, and the amount; the manner in which the consumer will be notified of changes to the terms and conditions, interest rates, and other fees and charges.

Meanwhile, there must be a cooling off period of 72 hours for all contracts without any disputed penalties, charges or interests being applied to the customer. This period should commence from the time of the customer’s signature and weekends and holidays should not be included in that 72-hour period.           

The customer should have the right to know his/her credit score and recorded credit history. Credit agreements can be deemed non-enforceable if it is ascertained that the lender has not carried out due process in terms of responsible lending.

The code also states that banks will provide notification of changes in fees and charges at least 60 days before they are to take effect. Automated Teller Machines (ATM) are to display all fees associated with each transaction prior to the completion of the transactions, and customers should be given the option of discontinuing the transaction if they do not wish to incur these costs.

Banks are to recognise the needs of the elderly, pregnant women and customers with disabilities, and to take reasonable measures to enhance their access to service.

Meanwhile, the code advises banks to establish an internal process for handling disputes, and that this should be free of charge. Customers should be notified of the name and contact number of the individual, who is investigating the dispute, and the institution should commit to an external process of resolving disputes with the consumer, consumer agencies, and other external parties where appropriate.

Upon receipt of a complaint of breach of any of the provisions of the Code of Conduct by a bank, if it is not rectified satisfactorily within 14 days, following due process and investigation, the CAC or the NCL may publish the circumstances of the complaint and the names of the offending parties.



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