BANK FAIL: She had to fly 800km for a replacement ATM card
A LACK of understanding of indigenous culture has led to banks blocking some of their customers from their money, with a Cape York woman forced to fly nearly 800km for a replacement ATM card.
Identification issues among bank customers in remote and rural communities has emerged as a key problem within the nation's banking system, the Australian Securities and Investments Commission has told a public hearing in Darwin.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard on Tuesday from ASIC senior policy analyst Nathan Boyle, who said Aboriginal and Torres Strait Islander people were being excluded from basic financial products, partly due to a lack of being able to meet basic identification criteria.
Mr Boyle said it could be quite difficult for indigenous Australians to verify their identities over the phone.
"Sometimes we see financial services have policies about the types of questions that are asked and they can only ask questions in a certain way which might not make any sense to an Aboriginal person in a remote community," he said.
"One that we come across quite regularly is … they will be asked, 'what is your street address? And in a lot of remote communities, there aren't street names and the person will say 'I don't have a street address'."
He cited an example of a woman from Lockhart River who contacted ASIC needing assistance after she was unable to access her bank account.
"(She) had lost her bank card, had failed the identification processes, and was then told to travel to Cairns to visit her local branch," he said.
"And it was during the wet season, so the only way that she could get to Cairns was to fly, which was quite expensive, and she was quite distressed when she contacted us."
The hearing was also informed that poor financial literacy had led to indigenous people being routinely ripped off by unconscionable lenders, such as Channic Pty Ltd and Cash Brokers Pty Ltd.
Last year, the Federal Court fined the Cairns based businesses more than $1 million for dealing unjustly with vulnerable consumers from Yarrabah.