Consumer groups have welcomed the Independent Review of the Customer Owned Banking Code of Practice, saying it contains important reforms for customers experiencing financial hardship, family violence, financial abuse and vulnerability.

The reforms come at a time when financial stress remains widespread. Around one in four Australian households have experienced a cash-flow problem in the past year, while one in five have been unable to raise emergency funds when needed. Complaints to the Australian Financial Complaints Authority also reached a record 111,373 in 2025.

The Review recommends stronger hardship protections, improved safeguards for victim-survivors of domestic and family violence, better support for First Nations customers, recognition of business-related financial abuse, greater transparency around artificial intelligence and stronger protections for digitally excluded customers.

Nadia Harrison, CEO of Mortgage Stress Victoria, said the Review provides customer-owned banks with an opportunity to demonstrate they genuinely put members first.

"Customer-owned banks often say they are different because they put people and communities ahead of profits. This Review gives them the opportunity to prove it.
"The recommendations are on the table. The question now is whether COBA and its members will fully embrace reform and implement the changes consumers have been calling for."

Consumer groups welcomed the stronger consumer protections but expressed disappointment that several important recommendations were not adopted, including:

• a clear commitment to seek ASIC approval of the Code;
• mandatory customer advocate functions across all member institutions;
• stronger commitments to fee-free banking for low-income customers; and
• stronger protections for access to face-to-face banking services.

They say community expectations are high and that customer-owned banks have a unique chance to set a new benchmark for banking conduct in Australia.

Consumer advocates are calling on COBA to commit to a clear implementation timetable and meaningful engagement with consumer organisations as the new Code is developed.

Quote attributable to Julia Davis, Principal, External Relations & Advocacy at Financial Rights Legal Centre

“While it’s disappointing that the report does not recommend COBA seek ASIC registration, ultimately the only stakeholder holding them back are the COBA banks themselves. If the sector continues to drag its tail, the public confidence they seek in the model will be severely dented.“

Quotes attributable to Bettina Cooper, Mob Strong Strategy and Operations Manager at Mob Strong Debt Help

“ACCC recently determined that ABA banks “big banks” should proactively move eligible customers into low or no fee accounts unless they choose to opt out, this is something we have advocated for and ACCC has delivered. It is disappointing outcome for people banking with customer owned banks (COBA) will experience less accessibility to low or no fee bank accounts and the most vulnerable customers will experience barriers without an opt out process. The chance to provide clear guidance to their sector on this issue has been missed. It should be more than guidance but a ‘must’ that Code obligations are enforceable under ASIC.”

“The recommendation that a standalone First Nations banking section to be developed in collaboration with First Nations advocates and stakeholders is warmly welcomed. There can be no more excuses from banks claiming not to know if they have First Nations customers, they need to ask for the purpose of providing a culturally safe banking experience. Banks now need to make good on their promise to look after all their customers, and step up and support their customers in a culturally sensitive and appropriate way.”

Quote attributable to Meg Dalling, Assistant Director, Consumer Action Law Centre:

“Customer Owned Banks often claim they are more community-focused. It’s about time they genuinely put people at the heart of their businesses, particularly through supporting their First Nations customers and customers experiencing vulnerabilities.”

Quote attributable to Zyl Hovenga-Wauchope, CEO, Financial Counselling Victoria:

“Financial counsellors support people at some of the most difficult points in their lives, whether they are facing mortgage stress, family violence, illness, job loss or overwhelming debt. The review rightly recognises that banks have an important role to play in responding to hardship and vulnerability, and we welcome recommendations that strengthen protections for people who may otherwise fall through the cracks.”

Quote attributable to Danielle Walt, Director of Policy and Campaigns, Financial Counselling Australia:

"While the Review recommends several positive changes, it leaves some of the most important consumer protections on the sidelines. Stronger independent oversight, universal access to customer advocates, better support for low-income customers, protection of face-to-face banking and meaningful safeguards for people unable to bank digitally should not be optional extras in a customer-owned banking code.”

Quote attributable to Patricia Sparrow, CEO, COTA Australia

“Banks have a responsibility to ensure vulnerable customers aren’t left behind. As banking changes, stronger consumer protections and proactive support need to be built into the way every bank operates.”

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