The Ombudsman has welcomed the approval of the Australian Banking Association’s (ABA) Banking Code of Practice.
The Australian Securities and Investments Commission (ASIC) approved the Code on Tuesday.
Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, said, “The new Code is in line with our Small Business Loans Inquiry, where we recommended the Code be revised, that it be approved by ASIC, and include a dedicated section on small business written in plain language.
“We’re disappointed the cap for small business loans is still set at a total loan facility of $3 million, as we had recommended a credit facility of at least $5 million, which would encompass capital-intensive small businesses such as farms, building and manufacturing.
“[But] we’re pleased ASIC will monitor the extent of the Code’s coverage of small business with data collected from banks and the Australian Financial Complaints Authority (AFCA), and publish that data every six months.
“We’ll be keeping a close eye on those figures, with particular focus on industries we think require a higher lending cap, and also on ASIC’s work on the review of the small-business definition.”