Press Release

The Hong Kong Association of Banks (HKAB) and the DTC Association (DTCA) have collaborated to publish the revised Code of Banking Practice (the Code), as part of the continued effort to strengthen customer protection in ever-evolving digital banking landscape. This is a further review since 2021 to keep up with the latest market trends and customer needs. The revised Code will come into effect from 7 December 2023. Authorized Institutions (AI) are expected to take necessary measures to comply with the revised provisions as quickly as possible. 

SUN Yu, Chairperson, the Hong Kong Association of Banks, said, “The banking industry in Hong Kong has been harnessing financial technology to provide customers with innovative, convenient and efficient banking services in recent years. The industry acknowledges the importance of cybersecurity and consumer protection while facilitating easy access to financial services. The latest revisions primarily aimed at promoting the industry to strengthen the security of digital banking services to maintain a balance between innovation and consumer protection. In addition, the revised Code places strong emphasis on increasing the transparency of banking services, promoting financial inclusion and treating customers fairly for enhanced customer experience.  We would like to extend our gratitude to all stakeholders for their valuable inputs in contributing to a more comprehensive Code of Banking Practice.”

Major enhancements to the Code include:

• Enhancing disclosure requirements in digital banking services, which incorporated the updated G20/OECD High-Level Principles on Financial Consumer Protection as general principles. AI are required to prominently and clearly disclose product information to facilitate customers’ understanding. The interface for Internet Banking platforms should be designed to prompt customers to review product information and application details before proceeding any transaction.
  
  
• Increasing the transparency of banking services involves several key aspects, including providing reasons for declining to open, inhibiting or closing a customer’s account; serving advance notification when exercising the right of set-off; notifying customers of significant changes to lending terms and conditions, or any changes resulting in the increase of overall interest rates.
  
  
• Strengthening protection in card services, by requiring card issuers to obtain agreement from cardholders before increasing their credit limits. Card issuers should provide convenient channels for cardholders to request credit limit reductions. Card issuers should enhance security risk advice provided to cardholders, particularly concerning authentication factors used for transactions, and their responsibilities when detecting suspicious card transactions as well as the need to ensure their contact details are updated.

 

AI are expected to achieve full compliance with the new provisions as quickly as possible within 6 months of the effective date, with an extension of up to 12 months (and 18 months for specified sections mentioned in the Code) for provisions requiring more extensive system enhancements.

The Code is available on the websites of HKAB (www.hkab.org.hk) and DTCA (www.dtca.org.hk).

 

The Hong Kong Association of Banks

The DTC Association

 

Notes to the Editor:

Jointly issued by HKAB and DTCA, the Code of Banking Practice (the Code) is a non-statutory document.  The Hong Kong Monetary Authority (HKMA) expects all Authorized Institutions to comply with the Code and will monitor compliance as part of its regular supervision.

The latest Code was reviewed by HKAB’s Code of Banking Practice Committee (CPBC), which includes representatives from HKAB, the DTCA and HKMA.  The Consumer Council has been consulted during the review.

The Code is updated from time to time. The last review took place in 2021.  The CBPC will continue to adapt and evolve the Code in response to market developments and changes in relevant laws and regulations.

 

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