Banks and insurance companies are increasingly being slated on social media for decisions they make that are within the law but plainly unfair.
“Historically the sector looked at what is legal as opposed to what is fair. What this bill seeks to do is to say: your legality now relies on whether your decision was fair. Even if they are right in terms of contract laws, financial institutions now have to ask themselves if the contract itself [is] fair,” said the Treasury’s Katherine Gibson on Wednesday.The bill is part of the Twin Peaks architecture established by the Financial Sector Regulation Act that became law in 2017.
“In anticipation of this outcomes-based approach we started the conversation, for example, with banks on what this will mean. Even now, certain institutions are still coming to us when we raise concerns about certain behaviour, saying until we tell them they can’t do it, they will continue. That in itself is very telling of how the industry operates,” said Gibson.