Consumer protection - Bank reform welcome but not complete

The announcement yesterday of a new consumer protection code to ensure that banks are not allowed to rip off customers should be welcomed, but with a health warning.

The new consumer protection code is the result of more than two years of consultation with the financial services industry.

In the circumstances no one should be deluded into any false sense of security about the nature and design of the new code. Reforms that are industry-inspired and backed are most likely designed primarily to protect the more responsible elements of the industry, and the benefit to consumers is frequently only a secondary consideration. But all responsible elements should benefit from the new code, which is partly designed to prevent banks from bombarding vulnerable customers with offers of cheap credit.