Bank stopped bankrupt customer’s internet banking access

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Bank stopped bankrupt customer’s internet banking access

Categories:

Credit laws and banking,

Summary:

Makana’s bank stopped her Visa debit card and internet banking access after learning she had been declared bankrupt. She contacted the bank to say she could not get to a branch – her only other means of accessing banking services – because she was in Australia. The bank sent her EFTPOS cards but declined her request to reactivate internet banking, saying it would do so only once her bankruptcy period ended. It explained that it needed to deactivate her internet banking to enable it to comply with its obligations under the Insolvency Act 2006. Makana was unhappy with this response and asked us to investigate.

Published:

August 2021

Our investigation

The bank’s policy was to deactivate internet banking access to bankrupt customers to enable it to comply with its obligations under the Insolvency Act 2006. The bank acknowledged this was an issue for customers, and was working on a solution for allowing some internet banking access. As it had not breached any duty or obligation owed to the customer, we could not require the bank to reinstate Makana’s internet banking access.