Financial inclusion targets housing affordability

Good Shepherd Microfinance aims to work with the banks as it plans to include housing affordability in its Financial Inclusion Action Plan (FIAP).

The four major banks have already signed up with the FIAP which was launched recently. The banks were part of the 12 "trailblazers" on the program which included other organisations in financial services including Bank Australia, Suncorp and industry superannuation fund HESTA.

Already the banks and these firms have committed to a range of initiatives to help 3.3 million Australians who are financially excluded, unable to access the basic financial products and services they need.

"The FIAP is a blueprint for how an organisation is going to make a difference to people in Australia experiencing financial exclusion and hardship. It contains specific, measurable actions an organisation will take to advance financial inclusion," Good Shepherd Microfinance CEO Adam Mooney said.

The 12 trailblazers have collectively committed more than 240 actions and Mooney gave AB+F "a flavour" of some of these initiatives.


Financial re-engineering

The Commonwealth Bank of Australia is actively promoting its hardship program which provides 'loan holidays' for its customers who have fallen on difficult times through loss of income. Westpac has committed investments for Aboriginal and women.

"Aboriginals and women are the most impacted by financial exclusion. Westpac aims to increase spend with its suppliers including enterprises that are owned by indigenous people and women," he said.

Suncorp will also continue to develop its current micro-finance products, such as Essentials by AAI insurance and Everyday Essentials bank account, and explore opportunities to expand and integrate them across all Suncorp’s functions.

Following the successful launch of the FIAP, Mooney said the organisation will also look at developing innovative programs that help long-term housing tenants afford to buy their home.

"We are looking at ways such as creative financial re-engineering and other initiatives such as extending the average 30-year mortgage loan to 30 years. We have plans to work with the banks on these initiatives," Mooney said.


Tip of the iceberg


Another planned initiative is micro-enterprise development.

"There is already some really good work done by Westpac and the National Australia Bank but it is only the tip of the iceberg.

"We plan to develop more programs that provide people with business coaches and financial support that gives them financial independence."

Quoting independent research from economist Saul Eslake, Mooney said that the FIAP could contribute $2.9 billion to GDP and save the government $583 million over ten years.

"Helping people who are excluded and face financial stress become economically mobile places less stress on government expenditure initiatives such as drug and alcohol programs and other crisis services.

"We hope to add more trailblazers to the program. Together we aim to create a large-scale financial inclusion society which benefits us all."

Categories
Banking, Wealth,
Tags:
Good Shepherd, microfinance, financial inclusion, bank
Author:
Christine St Anne, online@financialpublications.com.au
Article Posted:
December 01, 2016

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