Code of Banking Practice

This Code deals with our relationship with you, our personal and small business customers in South Africa. All banks which are members of the Banking Council are committed to maintain the standards of fairness set out in this Code. We have accepted the jurisdiction of the Banking Adjudicator to make binding rulings based on the law where that is appropriate and recommendations based on this Code. If we refuse to abide by a recommendation of the Adjudicator, we have agreed that the Adjudicator may publish his or her recommendation and that the relevant bank has refused to accept and act on that recommendation.

None of the provisions of this Code:

• Will be justiciable in a court of law;
• May be used to influence the interpretation of the legal relationship between a customer and the bank;
• Will give rise to a trade custom or tacit contract or otherwise between a customer and the bank.
• The Code provides valuable safeguards for customers and should help you to understand how members of the Banking Council are expected to deal with you. Customers can check with the Banking Council which banks are members. Copies of the Code are available from the member banks and from The Banking Council.
• In the text of the Code, "you" means the customer and "we" and "our" refers to the customer's bank. The Code will only apply to small businesses to the extent that it is relevant to corporate entities.

Acknowledgement
This Code is based, to an extent, on the Banking Code 3rd Edition, March 1997 of the British Bankers' Association. Their support is gratefully appreciated.
 

We, the members of the Banking Council undertake that we will:

• act fairly and reasonably in all our dealings with you;
• ensure that all services and products comply with this Code, even if they have their own terms and conditions;
• give you information on our services and products in plain language, and offer help if there is any aspect which you do not understand;
• help you to choose a service or product to fit your needs;
• help you to understand the basic financial implications of:
  • a mortgage
  • loan products
  • savings and investment products
  • card products
  • payment services
  • foreign exchange;
• help you to understand how your accounts work;
• have safe, secure and reliable banking and payment systems services;
• ensure that the procedures our staff follow reflect the commitments set out in this Code;
• correct errors and handle complaints speedily;
• take care to understand your financial difficulties and mortgage arrears when you approach us;
• ensure that all services and products comply with relevant laws and regulations;
• act with uncompromising integrity and fairness so as to promote complete trust and confidence in ourselves, individually and as an industry;
• ensure that our credit criteria, products and services are based and applied solely on commercial principles and criteria and do not discriminate against you on the basis of race, religion, age, pregnancy, marital status, sex, gender, sexual orientation, ethnic or social origin, disability, colour, conscience, belief, culture, language and birth save to the extent that a distinction is required or justified by any law or to the extent that that factor has commercial implications or in respect of special product or service offerings designed for all members of a particular target market group;
• only charge you interest on monies actually owing to us and debited to your account.
   

When you become a customer and at any reasonable time you ask, we will give you:

Key features:

• Clear written information explaining the key features of our main services and products.
• Your account: Information on how your account works, including:
  • stopping a cheque or other types of payment;
  • when funds can be withdrawn after a deposit has been paid into your account and when funds begin to earn interest;
  • unpaid cheques;
  • stale cheques;
  • when your account details may be passed to credit reference agencies.

Charges:

• Details of charges for basic banking services - full details of charges for any service are available on request;
• Information whether fees or charges are negotiable or not.

Interest rates:

• Information on the interest rates which apply to your account(s), when interest will be deducted from or paid to you and the basis on which interest is calculated.
   

ATM charges

We will notify you of changes to ATM charges with ATM messages and/or advertisements in the media. Details of these charges can be obtained from your bank.
 

Overdrafts and fixed term products

We will inform you of any additional charges and interest you may have to pay when:

• your account becomes overdrawn without prior agreement;
• you exceed your overdraft limit;
• your loan falls into arrears;
• you decide to settle a loan early

Mortgage loans

When you apply for a mortgage loan, and at any reasonable time you ask, we will explain to you the operation and repayment of your mortgage, including all the charges and costs, the benefits of payment acceleration and additional interest costs payable should you fall into arrears, and the steps required in law should we have to act to repossess it if you are unable to meet your repayment obligations.
 

Other charges

We will inform you of the charges (and the applicable amount where possible) for any other service or product before or when it is provided to you or at any reasonable time you ask while you are a customer.
 

Terms and Conditions

• Plain language:
  • All written terms and conditions will be fair in substance and will set out your applicable rights and responsibilities clearly and in plain language, with legal and technical language used only where necessary. Where legal and technical language occurs we will provide an explanation.
• Closure:
  • We will not close your account without giving you reasonable prior notice at the last address provided by you to us. However, we reserve the right to protect our interests should we have to act against you for defaulting on your account or in the event of fraud or suspected fraud on your account.

Keeping you informed of changes

• Terms & Conditions:
  • Occasionally terms and conditions may have to be changed. We will give you reasonable notice of these changes before they become effective such that you will have time to decide if you want to continue with the product or service, taking the changes into account, or if you want to cancel that product or service. If there have been significant changes to terms or conditions over any one year, we will give or send you a copy of the new terms and conditions or a summary of the changes at the last address provided by you to us.
• Charges:
  • If there is a change in the charges for basic banking services, we will give you reasonable prior notice by either:
    • letter/statement/other personal notice; or
    • notices/leaflets in branches; or
    • ATM messages; or
    • media advertisement.
• Interest rates:
  • The interest rates, which apply to your accounts, may change from time to time because of the volatile international and local financial markets. We will endeavour to give you as much notice as possible of changes in interest rates. In the case of mortgage loans we will, at the absolute minimum, give notice in the public media of any increase (but not decrease) in interest rate. We will moreover, give notice of change in any interest rates the next time we communicate with you in writing through a bank statement or other communication, and in terms of the requirements of prevailing legislation.

Marketing of services

We may bring to your attention details of our other services and products, which may be of benefit to you.

However, when you become a customer, we will give you the opportunity in writing to say that you do not wish to receive this information.

• Consent to group marketing:
  • In order to enhance our existing relationships with you we may give certain information about you to other subsidiaries within our group for marketing purposes. We may also tell you about another company's services or products and, if you respond positively, you may be contacted directly by that company.
• Withholding Consent:
  • In both the above cases, if you are a new customer we will first obtain your consent to do this. In the case of existing clients, we will inform you that you may withhold your consent to our doing this, and how to exercise that choice. If you do not withhold your consent, we will presume that you have agreed to our continuing the practice. You will not be pressurised for your consent in return for our services and products.
• Responsible credit:
  • We will market and approve loans responsibly in an attempt to ensure that you are not extended financially beyond your means. However you have an obligation to inform us and keep us informed of all your loans, other financial commitments, income and changes to these and continuously to act responsibly in all your financial affairs.
• Advertising:
  • We will ensure that all advertising and promotional material is clear, fair, reasonable and not misleading. We will comply with the appropriate advertising authority guidelines.

Mortgage loans

• Buying a home with a mortgage loan may be your most important financial commitment. We will assist you to understand the wider responsibilities and rights that you will have as a homeowner, and assist you with a detailed affordability assessment should you require it. The impact of variable versus fixed interest rates will be clearly explained to you so that you can make an informed decision. It will also be explained to you that you could lose your house should you not keep up your loan repayments. We will explain to you the requirements imposed by law in the event of the bank having to repossess your home due to your non-adherence to the conditions of the contract.
• As financiers we do not have the skills or the resources to monitor or control the quality of the building you are building or buying. We will clearly inform you that our appraisal is solely to enable us to assess the value of the security to us. It is not intended to be an evaluation of the present or future market value of the property, nor does it have to be the same as the purchase price. We have not necessarily inspected the property and do not accept any responsibility or liability for the structural or other condition of the security, even if the loan is a development or building loan.
• Should you require it, we will provide you with:
  • the assessed value of the security; and
  • the minimum replacement cost for insurance purposes that we have placed on the buildings and improvements.
• Issues of home quality are the responsibility of the seller (or builder or developer) and yourself as buyer. Homes younger than 5 years may also have a National Home Builders Registration Council Limited Warranty. You must satisfy yourself to the best of your ability that you are buying a good product and if necessary obtain assurance as to the structural quality of the property, compliance with local authority requirements and replacement costs of the buildings and improvements from the proper experts.
• When your mortgage bond has been paid up we will inform you how annual insurance premiums, other charges and administrative matters can be dealt with in future.

Savings & investment accounts

• We will take care to give you clear and appropriate information on the different types of savings and investment accounts available from us to help you make an informed choice on the products to fit your needs. We will help you understand how your savings and investment accounts work, including any additional charges or loss of interest for withdrawal or early cancellation. Should you wish to consider the tax implications of your choice of investment, you should seek independent advice from an appropriate consultant qualified to provide this to you.
• You should ensure that you manage your savings and investments properly in order to meet your personal financial needs and circumstances. You should make yourself aware of the opportunities for savings and investments in the financial market place. Remember only to deal with reputable product suppliers.
• As regards investments which automatically rollover at the end of their term, we expect you will inform us should you not want this to happen.

Closure of Bank Branches and ATM Centres:

We will give reasonable prior notice of our intention to close any of our bank branches or ATM centres.
 

Running your account

• Statements:
  • To help you manage your account and check entries on it, we will give you regular account statements. These may be provided monthly, quarterly, or at a minimum annually, unless this is not appropriate for the type of account. You may ask for account statements to be provided more frequently than normally available on your type of account.
  • Statement details may also be available on request or through electronic banking terminals. You may be charged for statements requested over and above those normally provided. You must ensure that you manage your use of statements to meet your requirements taking into account the costs of providing them.
  • If your statement or savings account book has an entry, which seems to be wrong, you should tell us within 30 days or as soon as possible so that we can resolve matters.
• Cheques:
  • We may keep original cheques paid from your account or copies of these, where the originals have been returned to you, for the period prescribed by law. If we do, we may charge a fee for supplying you with additional copies.
  • If, within a reasonable period after the entry has been made, there is a dispute with us about a cheque paid from your account, we will give you the cheque or a copy (where the cheque has already been returned to you) as proof of the instruction to pay.
  • When we need to inform you that we have returned one of your cheques or other items as unpaid, we will do this within a reasonable period of time and in the most cost-effective way, assuring you of our efforts to maintain confidentiality and privacy.
  • When we become aware that a cheque deposited by you is returned unpaid, we will inform you within a reasonable period of time and in the most cost-effective way.
  • When you deposit a cheque you should remember that we usually act as a collection agent on your behalf. We may, at our discretion, credit the value of this deposit to your account and determine if that credit may be accessed before we get value ourselves. Should we in turn not receive value for any reason, we will reverse the credit and any associated interest.
• Lost or damaged payment instruments:
  • All banks (locally and internationally) work on the principle that if you hand a cheque to them for collection, they act as your agent to collect the funds from the cheque issuer's bank. As such, and given the complexities of a cheque clearing system, they can not accept responsibility for the loss or theft of the cheque in the system. Consequently, if a cheque or other payment instrument which you have deposited for collection is lost or damaged, you will have to approach the issuer of the cheque or instrument to stop payment (if it has not already been paid out) and issue a replacement cheque or instrument. If you provide us with the relevant details of the drawer of the 'lost' cheque, and you mandate us to act on your behalf, we will take reasonable steps to replace the cheque. We may require an indemnity from you in case the original cheque has already been paid to you.
• Cards and pins:
  • We will issue you a card, or replace one which has already been issued. A replacement fee may be charged.
  • Your PIN (Personal Identification Number) is strictly confidential. Where a bank supplies it, it will be advised only to you and will be issued separately from your card. You should never disclose your PIN to anyone, including any employee of the bank.
• PIN self-selection:
  • We will tell you if you can select your own PIN and, if so, you will be encouraged to do so carefully. This should make it easier for you to remember your PIN.

Lending

• Financial assessment:
  All lending will be subject to our assessment of your ability to afford and willingness to repay. This assessment may include:
  • taking into account your income and expenses, including the dependability of your income;
  • how you have handled your financial affairs in the past;
  • information obtained from credit reference agencies and, with your consent, from other appropriate parties, for example employers, other lenders and landlords;
  • information supplied by you, including verification of your identity and the purpose of the borrowing;
  • credit assessment techniques, for example, credit scoring;
  • your age;
  • any security or collateral provided;
  • taking into account your statement of assets and liabilities.
• Notification that credit has been refused:
  If an application for credit is declined we will inform you of the reasons for this which could include whether the decline is based on:
  • the overall credit score;
  • credit reference agency information;
  • over-indebtedness; or
  • a specific policy of the bank.
  • With automated credit scoring systems these reasons may not be explicit in which case general reasons only, can be provided.
• Suretyships:
  If you want us to accept a suretyship or other security from someone for your loans, we will inform you that the surety is entitled by law to your confidential financial information.
  
• We will:
  • encourage the surety to take independent legal advice to make sure that they understand their commitment and the potential consequences of their decision. All the documents they will be asked to sign will contain this recommendation as a clear and prominent notice;
  • advise and caution them that by giving the surety or other security they may become liable instead of or as well as you;
  • advise them whether it is a limited (and the maximum value) or unlimited suretyship.

Foreign exchange services

We will give you an explanation of the service, details of the exchange rate and an explanation of the charges which apply to any foreign exchange transactions which you are about to make. Where this is not possible, we will inform you of the basis on which these will be worked out.

• If you wish to transfer money abroad, we will inform you how this is done and will give you, at least, the following information:
  • a description of the services and how to use them;
  • an explanation of when the money you have sent abroad should get there and any reason for potential delays;
  • any commission or charges which you will have to pay, including a warning where a foreign bank's charges may also have to be paid by the recipient.
     

Confidentiality

We will treat all your personal information as private and confidential (even when you are no longer a customer). Nothing about your accounts nor your name and address will be disclosed to anyone, including other companies in our group, other than in four exceptional cases permitted by law. These are: 

• where we are legally compelled to do so;
• where it is in the public interest to disclose;
• where our interests require disclosure; (This will not be used as a reason for disclosing information about you or your accounts (including your name and address) to anyone else including other companies in our group for marketing purposes.)
• where disclosure is made at your request or with your written consent.

Credit reference agencies

Information about your personal debts owed to us may be disclosed to credit reference agencies where: 

• you have fallen behind with your payments and you have not made proposals satisfactory to us for repayment of your debt following formal demand and you have been given at least 28 days' notice of our intention to disclose; or
• you have given us written consent; or
• you have a cheque referred to drawer, the information is placed on a cheque verification service.

Where the amount owed or arrears amount is in dispute, the fact (but not the amount) of this dispute will also be disclosed. 

We will not give any other information about you to credit reference agencies without your prior written consent.
 
Data transparency

We will inform you of your rights to access your personal information held by us.
 

Protecting your accounts

• Identification: When you first apply to open an account or obtain a loan, we will inform you what identification we need to prove identity. This is important for your security and may be required by law. We will also inform you what checks we may make with credit reference agencies.
• Taking care: Taking care of your cheque book, savings account book, cards, electronic purse, PIN's, passwords and selected personal information is essential to help prevent fraud and protect your accounts. Please ensure that you: 
  • do not keep your cheque book and cards together;
  • do not allow anyone else to use your card, PIN and/or password;
  • always take reasonable steps to keep your card safe and your PIN, password and selected personal information secret at all times; never tell anybody who offers to help you your PIN or password, including any bank employee;
  • never write down or record your PIN, password or selected personal information without disguising it; for example, never write down or record your PIN using the numbers in the correct order;
  • take care and be alert to the risk of muggings and card swapping when using an ATM to do your transactions. It is essential that you tell us as soon as you can if you suspect or discover that:
    • your cheque book, savings account book, cards and/or electronic purse has been lost or stolen;
    • someone else knows your PIN, password or your selected personal information.

Loss - what to do:

When you report a lost or stolen cheque book, savings account book, card or electronic purse, please ensure that we give you a code or other reference to confirm that you have reported it. Once you have advised us that a cheque book, savings account book, card or electronic purse has been lost or stolen or that someone else knows your PIN, password or selected personal information, we will take immediate steps to prevent these from being used to access your account. 
 

Responsibility for losses:

We will refund you the amount of any transaction together with any interest and charges: 

• where you have not received your card and it is misused by someone else;
• for all transactions not authorised or effected by you after you have informed us and we have acknowledged it that someone else knows your PIN, password or selected personal information;
• if additional money is transferred from your account to your electronic purse after you have informed us (and we have acknowledged it) of its loss or theft and that someone else knows your PIN, password or selected personal information;
• where faults have occurred in the ATMs, or associated systems used, which were not obvious or subject to a warning message or notice at the time of use.
• We expect you to report all incidents of stolen chequebooks, savings account books, cards or fraudulent transactions to the police for investigation. 
  
  
• Electronic purse:
  • You should treat your electronic purse like cash in a wallet. You may lose any money left in the electronic purse at the time it is lost or stolen, in just the same way as if you lost your wallet.
• Cards:
  • We accept that if it is clear that members of the public are vulnerable to crime if they transact at certain ATMs, we will take reasonable precautions to minimise crime at those ATMs. You also have a responsibility to take reasonable precautions when using an ATM to minimise the possibility of criminal activities. You are requested to adhere to any notices of caution at ATM's in order to protect yourself against criminal activities at ATM's. In particular do not let anybody come near you or distract you while you are transacting at the ATM.
  • Where a card transaction is disputed, we have the burden of proving fraud or gross negligence or that you have received your card. In such cases we would expect you to co-operate with us and with the police in any investigation.
• Fraud and gross negligence:
  • If you act fraudulently you will be liable for all losses. If you act with gross negligence which has caused losses you may be liable for them. This may apply if you fail to follow the safe-guards set out in sections 4.4.2 to 4.4.6.
     

Financial difficulties

We will take care to understand your financial difficulties provided you approach us in good time. Should your account go into default, our first step will be to try to contact you to discuss the matter and it is imperative that you inform us at all times of any changes in your address and contact numbers. 
 

How we can help

If you find yourself in financial difficulties, you should let us know and in particular respond to communications we send to you as soon as possible. The sooner we discuss your problems, the easier it will be for both of us to find a solution. The more you tell us about your full financial circumstances, the more we may be able to help.

With your co-operation, we will take reasonable steps to develop a plan with you for dealing with your financial difficulties, consistent with both our interests and yours.
 

Complaints 

• Internal procedures:
  • We have internal procedures for handling complaints fairly and speedily and we will inform you what these are. These may include establishing a set time for an initial acknowledgement to your complaint. We will tell you how long it might take us to respond more fully.
  • If you wish to make a complaint, we will inform you how to do so and, what to do if you are not happy about the outcome. Staff will help you with any queries. 
• Adjudicator:
  • An independent Banking Adjudicator's Office has been established. The Banking Adjudicator is available at no cost to you to rule or recommend on any complaint which you and your bank may not have been able to resolve. The Banking Adjudicator is entitled to make a ruling based on the law where the law is reasonably certain or a recommendation based on this Code or where the law is uncertain. If the bank declines to accept any recommendation which the Banking Adjudicator makes, then the Banking Adjudicator may, at the his or her discretion, publish the fact that a recommendation was made and the bank refused to accept it.
  • All banks which are members of the Banking Council are automatically subject to the jurisdiction of the Banking Adjudicator. Your bank will supply you with the Banking Adjudicator's address, telephone and fax numbers. The current postal address is P O Box 5728, Johannesburg, 2000, telephone number (011) 838 0035 and fax number (011) 838 0043. 
• Review body:
  • This Code is monitored and regularly reviewed by the Banking Council. Complaints and suggestions concerning the terms and general operation of the Code can be made in writing to the Banking Council.
     

These definitions explain the meaning of some of the words and terms used in the Code.

They are not precise, legal or technical definitions. 

• ATM (Automated Teller Machine):
  A cash machine or free standing device dispensing cash which may also provide other information or services to customers who have a card and a PIN, password or other personal identification.
• Basic banking service:
  The opening, maintenance and operation of accounts for money transmission by means of cheque, other payment instruments or savings accounts.
• Cards:
  A general term for any plastic card, which may be used to pay for goods, and services, and to withdraw cash. For purposes of this Code, it excludes electronic purses.
• Credit reference agencies:
  Organisations which hold information which is of relevance to lenders. Banks may refer to these agencies to assist with various decisions, e.g. whether or not to open an account or provide loans or grant credit. Banks may give information to or seek information from these agencies.
• Credit scoring:
  A system which banks use to assist in making decisions about granting consumer credit. Credit scoring uses statistical techniques to measure the likelihood that an application for credit (a loan) will be a good credit risk.
• Electronic purses:
  Any card or function of a card which contains real value in the form of electronic money which someone has paid for in advance, some of which can be reloaded with further funds and which can be used for a range of purposes.
• Group:
  A group means a holding company as defined in the Companies Act 61 of 1973 and its wholly owned subsidiaries.
• Password:
  A word or an access code which the customer has selected to permit him/her access to a telephone or home banking service and which is also used for identification.
• Personal customer:
  A natural person, whether carrying on business or not, who maintains an account or who receives other services from a bank.
• PIN (Personal Identification Number):
  A number provided on a strictly confidential basis by a bank to a card holder. Use of this number by the customer will allow the card to be used to withdraw cash and access other services from an Automated Teller Machine (ATM) or point of sale device.
• Security:
  A word used to describe items of value such as a mortgage bond registered over a house, share certificates, life policies, etc., which represent assets used as support for a loan. Under a secured loan the lender has the right to sell the security if the loan is not repaid.
• Selected personal information:
  A selection of memorable facts and information of a private and personal nature chosen by the customer (the sequence of which is known only to the customer) which can be used for identification and to verify identification when accessing accounts, usually telephonically.
• Small business:
  Juristic persons, partnerships and trusts whose turnover for the last financial year was less than R3 million.
• Suretyship:
  An undertaking given by a person called the surety promising to pay the debts of another if that other person fails to do so.
• Stale cheque:
  A cheque which has not been paid because its date is too old, normally more than 6 months.
• Unpaid cheque:
  This is a term for a cheque which, after being paid into the account of a person to whom it is payable, is subsequently returned "unpaid" ("bounced") by the bank whose customer issued the cheque. This leaves the person to whom the cheque is payable without the money in his/her account.