Major bank CEOs call on government to ease lending rules
It’s concerning to hear this kind of sentiment spoken publicly. Responsible lending laws play a really important role in protecting consumers. And as far as we’re aware, tinkering with with, with them is not really on the table at the moment. And for good reason, because consumers at the moment really are experiencing very high levels of cost of living pressure. And so exposing them to more risk is is doesn’t seem like the right thing to be doing. But the banks are arguing that these rules are hamstringing them in relation to get giving loans to people on middle and lower incomes. And so they they’re missing out on getting credit. From your perspective, are you hearing that that’s happening or not? Well, really in addressing the balance between growth and risk, putting the risk back onto the consumer is really not the approach that would work at the moment. We think that exposing consumers to back to loans that they can’t really afford to pay actually causes much more harm than it does any good. So how significant were the recommendations from the Royal Commission and how much respect should there be for those recommendations considering the amount of evidence it heard? Yeah, the Royal Commission was a watershed moment for this country. And let’s not forget that was only five years ago and one of the key recommendations of the Commission was that the responsible lending laws ought to be upheld and enforced. So it’s very concerning to hear murmurs around weakening them or or changing those laws at this stage in the game. We’re just five years out and those are vital, vital consumer protections. But you’re pretty confident the government isn’t going to move on this. Yeah. Well, that’s a matter for government, Joe. But we will say that what we see on the national debt helpline and Frontline financial counsellors are seeing, they see the consequences of people who are unable to meet their debt repayments. And it is devastating. People that are calling in or seeing financial counsellors are overwhelmed, they’re experiencing extraordinary level, high levels of stress and it has an impact on everything, on your mental health, on your family life. People just are going from bill to bill and it’s really not a good situation. Yeah, give us more of an insight into that. Are you experiencing greater demand for those services? Yeah, we had a a quite a substantial increase over the first months of this year to the national debt helpline in terms of demand in February and March, we had almost 30,000 points of contact with the national debt helpline and the leading reason that people were calling in was housing stress. So that includes not being able to make mortgage report, mortgage repayments. That’s really concerning because given the way that the housing market is going, we know that people will do everything they can. They’ll cut every corner. They won’t pay other bills in order to meet their housing costs. So if they’re not having, if they’re not able to meet those mortgage costs, you can bet that they’re struggling in all of the areas. Yeah. So as far as you’re concerned, it’s the worst possible time for the banks to be talking about the easing of responsible lending rules. Absolutely. People need support, not increased risk.