ASIC has released Consultation Paper 323, Review of school banking programs seeking the public’s view of school banking programs as part of its ongoing review of their use and impact in primary schools.
School banking programs are programs where a bank has a relationship with a school to offer deposit products to their students. These students are encouraged to establish bank accounts and make ongoing deposits into those accounts at the school.
Through this review into school banking, ASIC is seeking to better understand:
- how these programs are implemented;
- how they are marketed to school communities;
- how students are engaging with these programs; and
- the type of accounts established through these programs while they are at school and in later years.
The Consultation Paper notes that:
- ASIC does not directly regulate school banking programs, but it does regulate the deposit accounts which must be opened in order for a student to participate in these programs. The ADIs that issue these deposit accounts must comply with their Australian financial services (AFS) licence obligations under s912A of the Corporations Act 2001, including the requirement to provide financial services efficiently, honestly and fairly;
- The school banking volunteers (including school staff and parents) who assist with these programs are not required to hold an AFS licence or be authorised by an AFS licensee.