New Guidelines Assist Financial Inclusion for Indigenous Australians

The First Nations Foundation and the Financial Services Council (FSC) have applauded changes to national guidelines to assist financial institutions in the identification of people of Aboriginal and Torres Strait Islander heritage.

The organisations said that for more than two years they had sought improvements to guidelines from the federal government’s financial intelligence agency, AUSTRAC to allow financial institutions to better identify and engage with Indigenous Australians.

The updated guidelines were announced at the Financial Services Council Summit in Melbourne on Wednesday.

FSC director of policy Andrew Bragg said allowing financial institutions to tailor identification of customers of Indigenous heritage would boost financial inclusion.

“The present law prevents financial institutions from taking cultural factors into account when legally identifying and engaging with the first Australians,” Bragg said

“This issue is particularly pronounced in remote communities where drivers licences and passports can be extremely rare.”

CEO of the First Nations Foundation Amanda Young said that in a world strangled by red tape, Aboriginal and Torres Strait Islander communities are often left out.

“Cultural practice may require you to change your name if it coincides with a relative who just died, an arbitrary date of birth may have been chosen for you which is not accurate, or your name is too challenging for western spelling,” Young said.

“It is a breath of fresh air for AUSTRAC to have found a common sense approach which can satisfy all needs and they are to be commended for this guidance. We hope the financial sector picks up on this leadership and adopt the same practice so our First Nations people are included financially.”

Young said for example, a common challenge that the guidance specifically addresses, is the difficulty around identification that occurs when a family member has passed away.

“As is customary in Indigenous culture, the name of a deceased family member may not be used for a period of time after their death.

“Many Indigenous Australians who share a name with a deceased person often subsequently change their name. Without official identification, such as a passport or driver’s license, verification of the new name becomes challenging for financial institutions and hampers the payment of insurance claims or superannuation to beneficiaries.”

Young said that for such a situation, the new guidance approves processes of verification based on reference letters by an acceptable referee, such as a doctor.

“These same verification processes can also be used by individuals for setting up bank accounts, superannuation and insurance services. Indigenous community cards are also listed as an acceptable form of identification. As such, the guidance paves the way for financial institutions to facilitate greater financial access to Aboriginal and / or Torres Strait Islander communities.”

The First Nations Foundation said it is the only nationally operating Indigenous charity solely dedicated to improving financial wellbeing.

AUSTRAC CEO Paul Jevtovic said the guidance would help financial businesses to more readily identify some of their most disadvantaged, low-risk customers and achieve higher levels of financial inclusion.

“AUSTRAC is pleased to collaborate with the financial sector to ease the regulatory burden and provide greater clarity for industry about customer identification requirements,” Jevtovic said.

“The new guidance aims to overcome difficulties faced by many Aboriginal and Torres Strait Islander customers in accessing financial services such as superannuation entitlements.”