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

Schedule 1 Amendment 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.