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

There's a growing push to make banking more accessible for the disabled - and one major bank aims to launch a solution.

A new Westpac-commissioned found nearly one in four Kiwis have a disability, and can encounter barriers to accessing accounts and services.

The bank wants to introduce a new 'basic' bank account, to help reduce numbers of people not using banking.

Chief executive Catherine McGrath says it matches a UK offering, with specific features.

"The don't have overdrafts, the types of transactions can be a bit restricted."

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Episode Transcript

Speaker 1 (00:00):
Westpac wants to introduce a new type of basic bank
account to make sure people who struggle to get a
normal bank account aren't left out in the cold. The
bank has just published a report that looked into this.
It suggests a basic transaction account could decrease the unbanked population.
These are people like people who have cognitive disabilities, former
and current prisoners, bankrupts, and young people from tougher backgrounds. So,

(00:24):
Katherine McGrath is Westpac's chief executive and joints me. Now,
Hello Catherine, hi, Andrew, are you good? So what are
the reasons why people might not have access to a
bank account.

Speaker 2 (00:33):
Well, it can be a number of things. Proof of
our identity and proof of address tend to be really
important things to open a bank account, and that's important
for anti money laundering legislation. But it can also inadvertently
cause real barriers. And that could be because somebody doesn't
have a driver's license, for example. It could be because

(00:54):
hard for them to get their birth certificates, or it
could be because they've been in prison and their bank
has closed their bank account.

Speaker 1 (01:02):
And of course you come out of prison, you can't
get a bank account. You try to get a job,
they won't put your money into. They can't put your
money into a bank account. Therefore you can't get the job,
and it becomes a vicious circle.

Speaker 2 (01:13):
That's right. So we think it's incredibly important that banking
is as inclusive as possible because it makes it easier
for all of us to fully participate in communities. But
there are some segments that have a greater risk, and
so having an account with more limited features might be
able to help resolve this issue or at least make

(01:34):
it less bad than it is today.

Speaker 1 (01:36):
Well, how is a basic bank account different from a
regular bank account?

Speaker 2 (01:42):
So they have basic bank accounts in the UK, where
I spent quite a bit of time in that market,
They don't have overdrafts. The type of transactions can be
a wee bit restricted. If we're giving bank accounts to
people who we're slightly worried about, we might monitor the
transactions more closely, and that's with the agreement of the

(02:03):
person that's opened the account, and so they minimize the
breast for the bank, but still let somebody fully participate
in terms of getting regular payments in and being able
to make their payments out.

Speaker 1 (02:14):
Now, you gave me a UK example, and that's because
you're not offering a basic bank account yet, because you
want all banks to be offering these basic bank accounts.
So the question is why aren't they all or the
other question could be why don't you just crack on?

Speaker 2 (02:30):
So I think traditionally in New Zealand it hasn't necessarily
been seen as a particular issue. We're doing it as
a more ad hoc process at the moment, and some
of this insight has come from a broader reports that
we've done in terms of the million New Zealanders who
identify with having some form of disability, because if you

(02:51):
have cognitive disabilities, or visual disabilities, or even address disabilities,
those are things that can cause challenges when you're trying
to open a bank account. So we are doing it
to some extent, but we think as an industry approach,
including with the regulators, that could make it easier to
do so, working with the regulators and then ensuring that

(03:12):
everybody across the industry does do their past, because otherwise
you've got one segment who's frankly banking people who don't
really make the money because it's the right thing to do.
We think that's a responsibility that should be shared across
the industry.

Speaker 1 (03:26):
And there's lots of barriers for people in all areas
of banking. For instance, if you don't have braille on
a pin machine, on your pin thing, then the blind
can't do it. I know of one bloke who says,
when you can't figure out where the buttons are, you
end up with two choices who either walk out or
you give somebody your pin and you don't want to

(03:46):
do either.

Speaker 2 (03:48):
Completely agree. So designing products and services so they work
for everybody is really important. So whether that's on an
FoST terminal, making sure that it's got tactile thing so
it's easy to work out where the numbers are, which
is something that we've been working with our providers to do.
That's a really good thing to do. A number of

(04:10):
banks in New Zealand, including US, have debit and credit
cards with notches and braille on them, so that makes
it easier as well. And then I think another important group.
We've been doing training with our teams about recognizing what
the sunflower lanyard or pin indicates. And that's someone who's
saying I might need extra help, which may not be

(04:32):
that visible to you. So because I'm wearing this lanyard
or this pin. Please ask me what additional help I need.
And I think that's a great way of uncovering in
a way that feels good to everybody. What additional support
could be required.

Speaker 1 (04:45):
It's a great idea. Katherine McGrath, Westpactief Executive, joining me
on the basic bank account.

Speaker 2 (04:50):
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