Last updated 14 January 2019

The relationship between a bank and its customers is contractual. A contract is an agreement that is legally binding and enforceable by law (see chapter on Consumers and Contracts).

Some of the terms of the contract between a customer and their bank are written. Other terms of the contract are implied, that is the courts have over the years said that certain obligations exist between the customer and their bank that are not written down.

The Code of Banking Practice (Banking Code), developed by the Australian Banking Association sets out the bank’s key commitments and its responsibilities to its customers. It forms part of the written contract between the customer and their bank. Only banks that have adopted the Banking Code are bound by it. The ombudsman and the courts have increasingly found that the obligations form part of a contract between the bank and its customer and, even for non-signatories, the code represents good banking practice.