2016 Code of Conduct on the Switching of Payment Accounts with

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2016

Code of Conduct on the Switching of

Payment Accounts with Payment Service

Providers

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CHAPTER 1

SCOPE

1. This Code applies to payment accounts held by a consumer in the

same currency with payment service providers located in the State.

2. Where a payment service provider is a credit institution which

provides a payment account that is a current account (denominated in

euro) held by either:

a) a person or group of persons, but not an incorporated body

with an annual turnover in excess of €3million (for the avoidance

of doubt, a group of persons includes partnerships and other

unincorporated bodies such as clubs, charities and trusts, not

consisting entirely of bodies corporate); or

b) incorporated bodies having an annual turnover of €3 million or

less in the previous financial year (provided that such body shall

not be a member of a group of companies having a combined

turnover greater than the said €3million);

then this Code will also apply to those credit institutions in relation to

the persons specified in (a) and (b) above and such a person shall be

considered to be a consumer for the purposes of this Code.

3. In relation to paragraph 2, this Code will also apply to such a person that

may be a potential “consumer” of a credit institution.

LEGISLATIVE BASIS

Having regard to Article 10 of Directive 2014/92/EU and Regulation 9 of the

European Union (Payment Accounts) Regulations 2016 (S.I. No. 482 of 2016),

this Code is issued under Section 117 of the Central Bank Act, 1989.

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The Central Bank of Ireland has the power to administer sanctions for a

contravention of this Code, under Part IIIC of the Central Bank Act, 1942.

Payment Service Providers are reminded that they are required to comply

with this Code as a matter of law, having particular regard to paragraphs 1 and

2 of the Scope above.

Arising from the transposition of Directive 2014/92/EU, this Code of Conduct on

the Switching of Payment Accounts with Payment Service Providers replaces

the Code of Conduct on the Switching of Current Accounts with Credit

Institutions, introduced in October 2010 (the 2010 Code).

The replacement of the 2010 Code by this Code -

(a) does not affect any investigation undertaken, or disciplinary or

enforcement action undertaken by the Central Bank of Ireland, in respect

of any matter in existence at, or before, the time of the replacement of

the 2010 Code,

and

(b) does not preclude the taking of any legal proceedings, or the

undertaking of any investigation, or disciplinary or enforcement action by

the Central Bank of Ireland, in respect of any contravention of the 2010

Code which may have been committed before the time of its replacement

with this Code.

This Code comes into effect on 21 September 2016.

TO WHOM THIS CODE APPLIES

This Code applies to payment service providers when providing payment

accounts to consumers in the State.

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CHAPTER 2

DEFINITIONS

In this Code:

“associated undertaking” means an associated undertaking within the meaning of

section 275 of the Companies Act 2014.

“Account Transfer Form” means the form containing the information required in

Chapter 3(3).

“consumer” means any natural person who is acting for purposes which are outside his

or her trade, business, craft or profession and includes a potential “consumer”.

“credit institution” means the holder of an authorisation issued for the purposes of EU

Directive 2013/36/EU (or any preceding directive to this) relating to the taking up and

pursuit of the business of credit institutions.

“direct debit” means a payment service for debiting a payer’s account, where a payment

transaction is initiated by the payee on the basis of the payer’s consent given to the

payee, to the payee’s payment service provider or the payer’s own payment service

provider.

“group” includes a company, its parent and its subsidiaries and any associated

undertaking or related undertaking.

“payment account” has the meaning in the European Union (Payment

Accounts) Regulations 2016 (S.I. No. 482 of 2016).

“payment service provider” has the meaning in the European Union (Payment

Accounts) Regulations 2016 (S.I. No. 482 of 2016).

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“person” means a natural or legal person.

“record” means any document, file or information (whether stored electronically or

otherwise) and which is capable of being reproduced in a legible form.

“related undertaking” means:

a) companies related within the meaning of section 2(10) of the Companies Act 2014;

b) undertakings where the business of those undertakings has been so carried on that

the separate business of each undertaking, or a substantial part thereof, is not

readily identifiable; or

c) undertakings where the decision as to how and by whom each shall be managed

can be made either by the same person or by the same group of persons acting

in concert.

“switching date” means the date agreed by the consumer and the credit institution

for the switching process to commence.

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CHAPTER 3

PROVISIONS GENERAL

1. A payment service provider must have a payment account switching

pack available in each branch and on its website.

2. A payment service provider’s switching pack must contain at least the

following:

a) a description of the switching process, including the relevant

deadlines and a description of the steps which the consumer

must take to switch their payment account;

b) contact details for making an appointment, if the consumer is

required to visit the payment service provider in person to

open the payment account;

c) a copy of the payment service provider’s Account Transfer

Form which shall include the items set out in provision 3 below;

d) information about the importance of the switching date and why

it is preferable that it should be a date where there is least

activity on the payment account;

e) contact details to assist with queries in relation to the new

payment account and the switching process; and

f) where the consumer is opening a new payment account:

(i) the name and a description of each payment account

offered by the payment service provider. The

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description of the payment account must contain the key

features of the payment account and details of interest

rates and fees and charges which may apply to the

payment account; and

(ii) a list of the documents which the payment service

provider will require from the consumer in order to open

the payment account.

3. A payment service provider’s Account Transfer Form must make

provision for recording the following information:

a) the switching date;

b) whether the consumer is keeping their existing payment

account open or closing it;

c) the consumer’s consent to transfer relevant details between the

existing payment service provider and the new payment

service provider, and these details must accompany the

Account Transfer Form;

d) the consumer’s consent to transmit the new payment account

details to direct debit originators;

e) in relation to the payment service provider where the existing

payment account is held:

(i) the consumer’s consent to the transfer of the balance on

the existing payment account to the payment service

provider where the new payment account has been

opened, if the consumer has opted to close their existing

payment account; and

(ii) the consumer’s consent to transmit to the new payment

service provider details of debit card and automated

teller machine (ATM) card transactions on the existing

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payment account which have not been applied to the

consumer’s payment account by the switching date;

f) in relation to the payment service provider where the new

payment account will be opened:

(i) the consumer’s consent to set up standing orders and

operate direct debits on the new payment account,

when the list of standing orders and direct debits being

transferred to the new payment account is received by

the new payment service provider; and

(ii) the consumer’s consent to pay amounts in relation to

debit card and automated teller machine (ATM) card

transactions which have not been applied to the

consumer’s existing payment account by the switching

date and which are sought from the new payment

service provider.

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PROVISIONS APPLICABLE TO THE PAYMENT SERVICE PROVIDER TO WHICH A

CONSUMER INTENDS TO SWITCH ACCOUNTS

4. When a payment service provider is first contacted by a consumer

wishing to switch their payment account to that payment service

provider, it must:

a) provide the consumer with the switching pack referred to in

provision 2 above;

b) inform the consumer that if they wish to transfer a debit balance

to the new payment account, this will have to be agreed with

the payment service provider in advance; and

c) inform the consumer that if they require credit facilities on the

payment account, this would need to be discussed and agreed

in advance of the payment account being opened.

5. When the payment service provider receives a completed Account

Transfer Form from the consumer, without prejudice to the generality

of provision 2(a) and, as applicable, a payment service provider must

inform the consumer as to the practical considerations which they

should consider if they decide to switch payment accounts, including:

a) ensuring there are sufficient funds in both the new and old

payment accounts to meet any incoming debts including

standing orders, direct debits, cheques, interest, fees and

charges;

b) checking their payroll arrangements and preparing for any

changes that will need to be made arising from the switch;

c) notifying credit sources, including their employer, where

appropriate, who make payments into the payment account

other than by standing order, if the consumer wishes for these

to credit the new payment account;

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d) changing the details on their invoice documentation to include the

Bank Identifier Code (BIC) and International Bank Account

Number (IBAN) for the new payment account;

e) changing their sponsoring payment service provider if they are

a direct debit originator; and

f) verifying that the new payment account can, or will be able to,

accept Single Euro Payments Area (SEPA) payments, if this is

required.

6. Before the switching date, a payment service provider must:

a) inform the consumer that all of the active direct debits and

standing orders on the payment account will be transferred to

the new payment account, if the consumer intends to keep

their existing payment account open;

b) obtain a signed and completed Account Transfer Form from the

consumer;

c) inform the consumer that in relation to direct debits to direct

debit originators located outside the State, they will need to

inform such direct debit originators of their new payment

account details directly; and

d) where the consumer is opening a new payment account,

inform the consumer that the new payment account cannot be

opened until the application to open the payment account has

been approved.

7. If the consumer has stated his/her intention to close the existing

payment account which is the subject matter of the switching process,

the payment service provider must inform the consumer:

a) to refrain from using any bank card or cheque book on the old

payment account once the switching process has started;

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b) to return any unused cheques on the old payment account; and

c) to return any bank cards on the old payment account.

8. On or prior to the switching date, a payment service provider must

send the completed Account Transfer Form signed by the consumer

to the payment service provider where the existing payment

account is held.

9. A payment service provider must facilitate the setting up of the

standing orders on the new payment account once these are notified to

it from the credit institution where the existing payment account is

held.

10. A payment service provider must ensure that all actions required

under provisions 5 to 9 of this Code have been undertaken, within 10

working days of the switching date.

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PROVISIONS APPLICABLE TO THE PAYMENT SERVICE PROVIDER WHERE THE

EXISTING ACCOUNT IS HELD

11. Where the consumer has opted to close their existing payment

account, in addition to the steps required at provisions 13 to 16 below,

the payment service provider must:

a) with effect from the switching date, reject any direct debits

presented and cancel any standing orders on the existing

payment account;

b) refund the consumer any stamp duty paid on any unused

cheques they have returned;

c) add any interest due to the payment account prior to the

account closure;

d) apply any fees and charges due to the payment account;

e) transfer the balance on the payment account to the new

payment account; and

f) send a closing statement on the payment account to the

consumer.

12. Where the consumer has opted to keep their existing payment

account open, in addition to the steps required at provisions 13 to 16

below, the payment service provider must inform the consumer that:

a) all active direct debits and standing orders on the payment

account will be transferred to the new payment account,

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b) they will be liable for stamp duty on any bank cards held in

connection with both the existing and new payment accounts,

and

c) they need to inform credit transfer sources of their new payment

account details, if the consumer wishes these credits to transfer

to the new payment account.

13. When a payment service provider receives a completed Account

Transfer Form signed by the consumer, it must:

a) send details of the active standing orders and the direct debits

on the payment account to the new payment service

provider;

b) send details of the active standing orders and the direct debits

on the payment account to the consumer and inform the

consumer to check the details of the active standing orders and

direct debits and advise the payment service provider of

errors, if any;

c) inform the consumer that any changes they require to the list of

direct debits and standing orders on the payment account

should be notified to the new payment service provider, once

the switching process has been completed; and

d) write to the existing direct debit originators on the payment

account and inform them of the consumer’s new payment

account details.

14. With effect from the switching date, a payment service provider

must ensure that those direct debits that have been transferred to the

new payment account are returned to the direct debit originator

marked “account transferred”, if presented in error on the existing

payment account.

15. A payment service provider must forward to the new payment

service provider details of any debit card or ATM transactions on the

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old payment account for processing, which are received by the

payment service provider after the payment account has been

closed.

16. A payment service provider must inform a consumer who is

switching their payment account that he/she can request a statement

of their payment account for the last twelve months, either

electronically or in hard copy, free of charge.

17. A payment service provider must ensure that all actions required by

provisions 11 to 16 of this Code have been completed within 7 working

days of the switching date.

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COMPLIANCE

18. A payment service provider must be able to demonstrate that it is in

compliance with this Code.

19. A payment service provider must have adequate systems and controls

in place to ensure compliance with this Code.

20. Where the Central Bank of Ireland requires a payment service

provider to provide information in respect of the payment service

provider’s compliance with this Code, such payment service provider

is thereby required to provide information which is full, fair and accurate

in all respects and not misleading and to do so in any reasonable period

of time or format that may be specified by the Central Bank of Ireland.

21. Where the Central Bank of Ireland requires information in respect of a

payment service provider’s compliance with this Code, and the Central

Bank of Ireland is of the opinion that a meeting with personnel of the

payment service provider is necessary in order to procure such

information in a satisfactory manner, the payment service provider

must arrange for appropriate personnel to participate in such a meeting

in order to provide the required information to the Central Bank of

Ireland.

22. A payment service provider must, upon being required by the Central

Bank of Ireland to do so, provide to the Central Bank of Ireland records

evidencing compliance with this Code for a period prior to such

requirement as the Central Bank of Ireland may specify (up to a

maximum period of 6 years).

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Bosca PO 559, Sráid an Dáma, Baile Átha Cliath 2, Éire

PO. Box No 559, Dame Street, Dublin 2, Ireland

T +353 1 224 6000 F +353 1 224 6561 www.centralbank.ie code@centralbank.ie