Latest / Best of Business / Catherine McGrath: Westpac chief executive on the bank's plan to launch new 'basic' bank accounts

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Catherine McGrath: Westpac chief executive on the bank's plan to launch new 'basic' bank accounts · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks Be follow
• 0:12
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• 0:16
  Speaker 2: Westpac wants to introduce a new type of basic bank
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  Speaker 2: account to make sure people who struggle to get a
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  Speaker 2: normal bank account aren't left out in the cold. The
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  Speaker 2: bank has just published a report that looked into this.
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  Speaker 2: It suggests a basic transaction account could decrease the unbanked population.
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  Speaker 2: These are people like people who have cognitive disabilities, former
• 0:36
  Speaker 2: and current prisoners, bankrupts, and young people from tougher backgrounds.
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  Speaker 2: So Katherine McGrath is Westpac's chief executive and joins me. Now,
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  Speaker 2: Hello Katherine, Hi Andrew, are you good? So what are
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  Speaker 2: the reasons why people might not have access to a
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  Speaker 2: bank account.
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  Speaker 3: Well, it can be a number of things. Proof of
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  Speaker 3: our identity and proof of address tend to be really
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  Speaker 3: important things to open a bank account, and that's important
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  Speaker 3: for anti money laundering legislation. But it can also inadvertently
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  Speaker 3: cause real barriers. And that could be because somebody doesn't
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  Speaker 3: have a driver's license, for example, it could be because
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  Speaker 3: hard for them to get their birth certificates, or it
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  Speaker 3: could be because they've been in prison and their bank
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  Speaker 3: has closed their bank account.
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  Speaker 2: And of course you come out of prison, you can't
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  Speaker 2: get a bank account. You try to get a job,
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  Speaker 2: they won't put your money into They can't put your
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  Speaker 2: money into a bank account. Therefore you can't get the job,
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  Speaker 2: and it becomes a vicious circle.
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  Speaker 3: That's right. So we think it's incredibly important that banking
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  Speaker 3: is as inclusive as possible because it makes it easier
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  Speaker 3: for all of us to fully participate in communities. But
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  Speaker 3: there are some segments that have a greater risk, and
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  Speaker 3: so having an account with more limited features might be
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  Speaker 3: able to help resolve this issue or at least make
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  Speaker 3: it less bad than it is today.
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  Speaker 2: Well, how is a basic bank account different from a
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  Speaker 2: regular bank account?
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  Speaker 3: So they have basic bank accounts in the UK, where
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  Speaker 3: I spent quite a bit of time in that market,
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  Speaker 3: they don't have overdrafts. The type of transactions can we
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  Speaker 3: that restricted? If we're giving bank accounts to people who
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  Speaker 3: we're slightly worried about, we might monitor the transactions more closely,
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  Speaker 3: and that's with the agreement of the person that's opened
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  Speaker 3: the account, and so they minimize the brisk for the bank,
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  Speaker 3: but still let somebody fully participate in terms of getting
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  Speaker 3: regular payments in and being able to make their payments out.
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  Speaker 2: Now you gave me a UK example, and that's because
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  Speaker 2: you're not offering a basic bank account yet, because you
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  Speaker 2: want all banks to be offering these basic bank accounts.
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  Speaker 2: So the question is why aren't they all or the
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  Speaker 2: other question could be why don't you just crack on?
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  Speaker 3: So I think traditionally in New Zealand it hasn't necessarily
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  Speaker 3: been seen as a particular issue. We're doing it as
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  Speaker 3: a more ad hoc process at the moment, and some
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  Speaker 3: of this insight has come from the broader the reports
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  Speaker 3: that we've done in terms of the million New Zealanders
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  Speaker 3: who identify with having some form of disability, because if
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  Speaker 3: you have cognitive disabilities, or visual disabilities, or even address disabilities,
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  Speaker 3: those are things that can cause challenges when you're trying
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  Speaker 3: to open a bank account. So we are doing it
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  Speaker 3: to some extent, but we think as an industry approach,
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  Speaker 3: including with the regulators that could make it easier to
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  Speaker 3: do so, working with the regulators and then ensuring that
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  Speaker 3: everybody across the industry does do their part, because otherwise
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  Speaker 3: you've got one segment who's frankly banking people who don't
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  Speaker 3: really make the money because it's the right thing to do.
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  Speaker 3: We think that's a responsibility that should be shared across
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  Speaker 3: the industry.
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  Speaker 2: And there's lots of barriers for people in all areas
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  Speaker 2: of banking. For instance, if you don't have braille on
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  Speaker 2: a pin machine, on your pin thing, then the blind
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  Speaker 2: can't do it. I know of one bloke who says,
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  Speaker 2: when you can't figure out where the buttons are, you
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  Speaker 2: end up with two choices who either walk out or
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  Speaker 2: you give somebody your pin and you don't want to
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  Speaker 2: do either.
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  Speaker 3: Completely agree. So designing accents services so they work for
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  Speaker 3: everybody is really important. So whether that's on an f
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  Speaker 3: post terminal, making sure that it's got tactile thing so
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  Speaker 3: it's easy to work out where the numbers are, which
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  Speaker 3: is something that we've been working with our providers to do.
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  Speaker 3: That's a really good thing to do. A number of
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  Speaker 3: banks in New Zealand, including US, have debit and credit
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  Speaker 3: cards with notches and braille on them, so that makes
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  Speaker 3: it easier as well. And then I think another important
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  Speaker 3: group we've been doing training with our teams about recognizing
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  Speaker 3: what the sunflower lanyard or pin indicates and that's someone
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  Speaker 3: who's saying I might need extra help which may not
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  Speaker 3: be that visible to you. So because I'm wearing this
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  Speaker 3: lanyard or this pin, please ask me what additional help
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  Speaker 3: I need. And I think that's a great way of
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  Speaker 3: uncovering in a way that feels good to everybody what
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  Speaker 3: additional support could be required.
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  Speaker 2: It's a great idea. Katherine mcgarth, Westpactief Executive, joining me
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  Speaker 2: on the Basic Bank account for more from us
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