HESTA has joined 12 ‘trailblazer’ organisations from government, business, education and the community sectors to announce collective action to improve financial inclusion and resilience within Australia. At present many vulnerable households find the only place they can go to are payday lenders or a rent to buy provider.
HESTA will publicly release its Financial Inclusion Action Plan (FIAP), which details specific steps being taken by the organisation to improve financial resilience for its 820,000 members, 80% of which are women.
HESTA CEO Debby Blakey said the FIAP was an opportunity for the $36 billion industry super fund to assess how it can put in place measures to build greater financial resilience across its membership.
“Three million people in Australia are experiencing some form of financial exclusion, many of these are women, and this puts them at greater risk of poor social, economic and health outcomes.” Ms Blakey said.
This follows a round-table, organised by HESTA in Melbourne last week where experts and academics from a range of organisations including universities, charities and community groups discussed what financial institutions can do to build a more financially inclusive Australia.
“The round-table saw fruitful discussions on innovative and practical steps to build a more a financially inclusive Australia.”
It follows a move by the Australian Government in 2015 to commit to international obligations including the G20 Financial Inclusion Action Plan and the United Nation’s Sustainable Development Goals.
Good Shepherd Microfinance is leading the development of the FIAP program, in partnership with the Australian Government, EY and the Centre for Social Impact.
Good Shepherd Microfinance’s general manager advisory, Dr Vinita Godinho, said financial exclusion was a “wicked problem” with wide ranging impacts.
“Because these people don’t have that ready access… the only place they can go to buy these is actually a payday lender or a rent to buy provider… and these informal providers are much more expensive and many times the business model is exploitative. So what happens is people end up in debt spirals… where they are constantly borrowing more and more in order to repay a more and more expensive debt proposition.”
Godinho said there were also a lot of secondary effects that resulted from financial exclusion and a lack of resilience, such as domestic violence and financial abuse.
Westpac also steps up commitment to support financial inclusion.
Westpac Group confirms its commitment to helping Australians better manage their money, with the release today of its first Financial Inclusion Action Plan (FIAP).
Developed in response to Australia’s commitment to the United Nation’s Sustainable Development Goals, the Plan is a roadmap towards Westpac’s vision of helping Australians manage their money, build their financial resilience, and participate in our economy throughout their lives.
Westpac Group Chief Financial Officer, Peter King, said he was proud Westpac is among the first 12 trailblazing Australian organisations to release a Financial Inclusion Action Plan.
“At Westpac, we believe service leadership extends beyond helping people achieve their financial goals.
“It also means being there to provide support when customers experience financial hardship, helping to prevent them from falling into hardship in the first place, and removing barriers that may be blocking people from accessing banking.
“Our foundational Financial Inclusion Action Plan focuses on key areas where we believe Westpac can make the greatest contribution to financial inclusion in Australia. It brings together the work already in progress across Westpac Group, as well as setting out the specific priorities that will guide our initiatives over the next twelve months,” Mr King said.
The 15 commitments laid out in the Action Plan include enhancing Westpac Assist service for customers facing hardship and tailoring of financial services for specific communities at risk of economic downturn; expanding Westpac’s suite of financial education programs, including targeted education for youth and women over 40; and supporting small business and social enterprise to grow through grants, microfinance loans, access to Westpac’s supply chain and financial education.
The FIAPs of the 12 trailblazer organisations were produced as part of an Australian Federal government and industry initiative, coordinated by Good Shepherd and Ernst & Young (EY).
“Financial Inclusion Action Plans harness the influence and resources of industry leaders like Westpac Group to build a more inclusive economy and ensure that, as our economy grows, we’re not leaving people behind,” said Delia Rickard, Independent Chair, FIAP Advisory Group.
“The organisations that have signed up to Financial Inclusion Action Plans, including Westpac Group have identified practical ways to support the financial inclusion of their customers, employees and the broader community. The initiatives these trailblazers have put forward are much more than nice sentiments and ambitions, they have tangible, measurable outcomes,” she said.
