Australia’s major banks and finance providers have joined with a national financial safety expert to tackle financial abuse, announcing the launch of the Financial Safety Alliance.
The alliance has been established by social enterprise Flequity Ventures and brings together key industry bodies, including the Australian Banking Association (ABA), the Australian Finance Industry Association (AFIA), the Customer Owned Banking Association (COBA) and Arca.
Its focus is on helping lenders build financial safety by design into everyday banking and credit products, with the aim of reducing how financial tools can be misused to control or harm others. The initiative also seeks to improve support pathways for victim-survivors across the sector.
The move follows earlier action by 40 banks that updated their terms and conditions to explicitly ban the misuse of financial products for coercion or harm. Those changes put more than 20 million customers on notice that financial abuse will carry serious consequences.
Flequity chief executive Catherine Fitzpatrick said working directly with industry associations would expand the reach of these efforts to more than 200 banks and lenders nationwide.
“Together we’ll create tools to apply financial safety by design, closing the loopholes that abusers exploit and providing more consistent support to customers.”
ABA chief executive Simon Birmingham described the alliance as an important step for the industry as a whole.
“Unfortunately, banking products are exploited by the perpetrators of totally unacceptable financial abuse. It’s despicable behaviour that we want to stamp out.
“Through this coordinated action, Australia is setting a new benchmark for how financial institutions can work together to prevent abuse and safeguard customers.
“Australian banks are taking world-leading steps to help embed financial safety by design principles in banking products, helping stop abuse before it occurs.”
AFIA chief executive Diane Tate said non-bank lenders were also playing a role by embedding safety-focused approaches into daily finance.
“Australia’s finance industry stands united to deliver strong, consistent protections and pathways to support those experiencing financial abuse,” AFIA CEO Diane Tate said.
“This joint initiative puts customer wellbeing at the centre of innovation, strengthening trust across our industry through embedding safeguards that put people first.”
COBA chief executive Michael Lawrence said customer-owned banks see the effects of financial abuse at close range.
“Customer-owned banks witness the devastating impact of this insidious issue daily, which is why we are joining forces to address it on a system-wide level,” COBA CEO Michael Lawrence said.
“Customer-owned banks are deeply committed to the people and communities we serve, and this alliance will empower the entire industry to better identify abuse, stop perpetrators from misusing banking products and ultimately protect customers.”
Arca chief executive Elsa Markula said credit systems should support, rather than harm, consumers.
“Credit should be a tool for supporting your life, not a weapon. While our members are in the business of funding Australian lives, whether that’s buying a home, getting a car on the road, or simply managing everyday purchases. They also witness the devastation of financial abuse firsthand. We are proud to join this alliance, developing a framework that will not only improve recovery support for victim-survivors but, crucially, prevent the credit system from being weaponised in the first place.”
