Banking

VITAL SMALL BUSINESS PROTECTIONS SAVED IN NEW BANKING CODE OF PRACTICE

Olivia Pearce — Mon, 08 Jul 2024 22:57:40 +0000

VITAL SMALL BUSINESS PROTECTIONS SAVED IN NEW BANKING CODE OF PRACTICE Olivia Pearce Tue, 07/09/2024 - 08:57

09 July 2024

The Australian �Թ�� and Family Enterprise Ombudsman, Bruce Billson, says he welcomes the regulator’s decision to retain and enhance vital protections for small businesses in the new Banking Code of Practice.

“A push by the banks to shrink the Code has been rejected and they must continue to include an explicit and detailed pledge outlining how they will handle complaints,” Mr Billson said.

“The code will also be expanded to cover at least 10,000 more small businesses and it will include clear information about how a small business can enforce their rights.”

The Australian Banking Association’s code, which aims to set a consistent standard of good industry practice, has been approved by the Australian Securities Investments Commission and will come into effect on 28 February, 2025.

The Ombudsman strongly advocated against the Australian Banking Association’s proposal to remove from the code detailed ‘how to’ requirements regarding complaints-handling and instead refer customers to ASIC Regulatory Guide RG 271.

“It was never reasonable to expect busy and resource-constrained small businesses to read and understand regulator guidance for financial firms, and then to decipher and be clear on how to exercise rights afforded to them,” Mr Billson said.

“We are pleased ASIC has rejected this absurd change that would have omitted from the code existing explicit commitments by banks when there is a complaint to conducting a fair and reasonable process, as well as providing information on progress, a contact person, a written response, and an explanation and monthly updates regarding delayed responses.”

Mr Billson said small, family and farming businesses were frustrated with the banks, particularly in regional areas where branch closures and the removal of automatic teller machines have deprived them of face-to-face service.

“The banking code, like all industry codes, should be viewed as the ‘floor’ of minimum standards, not the ambition,” Mr Billson said.

“Competitive access to finance has been a longstanding challenge for small and family businesses. Policy incentives need to strike the right balance between managing risk and supporting entrepreneurship, including by ensuring small businesses have reasonable and reliable access to banking services.”

Mr Billson said the protections of the code will cover at least an extra 10,000 small businesses (and potentially many more), by increasing the value used in the aggregate borrowing criterion from $3 million to $5 million.

He said the code will also contain an updated introduction with information about how eligible individuals, small businesses and their guarantors can enforce their rights.

It will also commit banks that have signed the code to take reasonable steps to make sure a meeting is held with a prospective guarantor before taking a guarantee, and to discuss customer circumstances and reasonable alternatives to repay a guaranteed liability before selling a guarantor’s primary place of residence.

It also includes an updated conduct pledge by the banks to do all things necessary to ensure that banking services provided under the code are provided efficiently, honestly and fairly.

An updated definition of vulnerability and an enhanced definition of financial difficulty aims to cover customers who are likely or expecting to be unable to meet future repayments.

Mr Billson said while the banking environment was continually evolving, rising best-practice standards and expectations should be captured in each new version of the code.

“I call on the banks to make sure the benefits of their expanded commitments and the updates in the new code apply to both current and prospective small business customers,” he said.

Mr Billson also urged the independent review of the 2020 General Insurance Code of Practice, now under way, to follow ASIC’s example by applying the same lens of protecting small businesses and consumers.

Media contact: 0448 467 178 / www.asbfeo.gov.au

TRANSCRIPT: Banking announcement to fight scams, Australian Government’s cyber support for small business

Emily Carter — Mon, 27 Nov 2023 01:13:09 +0000

TRANSCRIPT: Banking announcement to fight scams, Australian Government’s cyber support for small business Emily Carter Mon, 11/27/2023 - 12:13

24 November 2023

TRANSCRIPT

Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson interview with Leon Delaney.

Radio 2CC Canberra

24 November 2023

Leon Delaney

Banks right across the industry have joined forces to launch something called the Scam Safe Accord. Now, the centrepiece of these Scam Safe Accord is name matching to account numbers, something that perhaps should have been done years ago. Nevertheless, never to look a gift horse in the mouth, better late than never. Joining me now, the Australian �Թ�� and Family Enterprise Ombudsman, Bruce Billson. Good afternoon.

Bruce Billson

Leon, fab to be with you and your listeners.

Leon Delaney

Thanks for joining us today. This is especially important for small business operators, isn't it? Because obviously one of the big scams that targets small businesses is when communications or invoices are intercepted and the scammers, the crooks, substitute the correct account information with incorrect account information, which means they get the money and everybody else loses. So how is this new initiative from the banking sector going to help?

Bruce Billson

This is a really positive step. You're right, it's been in place in some jurisdictions overseas. The UK have had something similar for a while. What basically happens is when you put in the account name, the BSB and the account number, it checks against that name and if there's an irregularity then it stops the payment going through.

This is fantastic news. If you and I had a regular relationship with another business or a customer, they may well be expecting the invoice to come through an email. And where this cyber scam kicks in is people then go in and change those banking details silently. You don't know. It all looks legit. It's expected. It's gone to the right customer. The sums are the right amount. You make the payment and then it's whisked away into a bank account and usually within moments probably converted to crypto currency. The customer or the supplier loses the money, and the business that's produced the goods or service doesn't get paid either. So, everyone's out of pocket. There's no good outcome and that can be really catastrophic for businesses that are caught up in that. I don’t know about you but some of those big bills that we pay as consumers, who's got the money ready just to replace that payment and settle that account?

Leon Delaney

Well, apparently, according to the data from Scamwatch, small businesses lost almost $14 million last year, and that represented an increase of almost double from the previous year. So obviously, there are crooks out there that have been making plenty of hay while the sun was shining. Maybe now the sun will be a little bit dimmer for them.

Bruce Billson

Well, I'm hoping so. And the banking industry's announcement - and a credit to those financial institutions for getting involved in this way - it comes off the back of some really useful announcements by the government earlier in the week as part of this cyber strategy. That's tools that let small businesses establish just how strong their cyber protections are. Some practical advice on the actions they can take. And also an announcement of a one-to-one help service in the event that you are the subject of an attack, what you do to recover.

Now, why is this so important? Well, the average cost of a small business cyber scam is about $46,000 Leon, but it can be more catastrophic than that. The business might lose the capacity to actually function. It might lose the confidence of its customers. And for too many small and family businesses a cyber event can be a business ending experience. And that's why it's so important to do what we can, to be protected as we can be, and to know what to do in the event of an incident.

Leon Delaney

What exactly were these two programs that the Federal Government announced earlier this week to help protect businesses?

Bruce Billson

The first one is a safety health check that looks at just how ready your business is. You know, it's part of a small business cyber resilience service. And you get onto the Australian Cyber Security Center's website. It’s pretty easy to find it's www.cyber.gov.au and in it is this cyber health check program and that can be really useful just to knowing where you can make stronger improvements in your cyber protection.

But beyond that, the Government's also announced that it will be going out to tender to get businesses to bid for a service that actually provides one-on-one support for a business that does experience an event because that can be really challenging Leon. There's a whole bunch of reporting obligations that businesses have to meet. But there's also advice, someone getting alongside you. What to do if there's a demand for a ransom? How do you recover your business system so that you can trade again? And also, what do you need to do with your customers and those that are in your business ecosystem to let them know that something's happened and to take appropriate steps?

This is the kind of practical advice and support we've been calling for, and it's pleasing to see some of these services responding to the needs small businesses themselves have identified.

Leon Delaney

Yeah, this matter of paying ransoms to get your own data back again, there were reports that the Federal Government was considering making it actually illegal to pay a ransom, but the government in the end decided not to go that far. Was that the right decision?

Bruce Billson

Look, I think so. It's difficult. If you and I or your listeners and I were running a business and some critical information was being held and we were told that if we paid a fee, we'd get it back. Sadly, that's the business model that the scammers operate under, and it's not always certain that you'll get that information back or that what they've gleaned through a cyber attack still won't end up on the dark web.

So, there's no guarantees. But what happens when those ransoms are paid is you're actually feeding the business model of the scammers, and therefore they'd be encouraged and resourced to keep going. Where the government's landed is to look to businesses to notify them that there's been a ransomware incident and what's happened. No penalties arising from the actions you take. But just a real hope that you share that experience, share the intelligence that can be gleaned from it, and then through the experts that are part of government steps can be taken to guard against further episodes.

Leon Delaney

Yeah, as you indicated, I'd be hesitant to pay any kind of ransom in the first place because I would not be convinced I would actually get my data back anyway. I would assume that they're just going to take the money and burn me anyway. But apparently, from what I've been able to read, there have been instances where businesses felt that they had no other option but to pay the ransom. And they have indeed got their data back, which I guess is a good outcome for them. But it was a hell of a gamble, wasn’t it?

Bruce Billson

I ache for the small and family businesses that are in that situation. You can imagine you put 20 years of your life into building that business. Some jokers jumped in through a cyber attack and has taken control of your accounting system or systems and technologies that are really critical to your business operations. You're sitting there wondering do I give up all of that lifetime of work or do I effectively gamble on criminals being decent? That’s a horrible call to have to make, which in my eyes, and I hope my encouragement to listeners Leon, is to take those steps that can be taken.

The banks are doing what they can do in the payment systems. The telcos that are implementing what they call a clean pipes measure where they cut off a lot of traffic that's run over the telecommunications system. But I'm urging small and family businesses to take the steps that are within their means. I mean, no one would leave their shop open with the light on and the door wide open in the middle of the night. It's taking appropriate steps in the cyber world like you would take in the real world. And it's good that there's help and support available with that.

Leon Delaney

Absolutely. And just back to this announcement from the Australian Banking Association and the Customer Owned Banking Association involving the entire gamut of the banking sector banks, credit unions, building societies, they're all part of this. It's called the Scam Safe Accord.

The thing that I can't help but question is that for all these years, whenever we make an electronic payment, we have to put in the BSB number, the account number and the name of the account holder. Why did we ever have to put in the name of the account holder if the banks weren't checking the name until now?

Bruce Billson

You're probably better off asking a banker about that Leon. I suspect it's got things to do with record keeping and the like.

Leon Delaney

They always used to tell us, though. Make sure you've got the numbers right because the name doesn't matter. Well, if the name doesn't matter, why did we have to put it in?

Bruce Billson

Well, it matters plenty these days. And maybe it's fortuitous, but now that information's being correlated. Where it can’t be confirmed that the payee is who you've got in mind, they’ll be blocks to that.

There's some other things too about biometrics checks and people opening a new account just in case they're trying to mimic you or have got some personal information. Even some warnings and notifications and delays. You know, I think the banking industry have said if there’s a pretty juicy big payment that might be suspicious, they might just slow the whole show down and maybe send some warnings and just check that this is what you intended to do. And make sure someone's not on the receiving end of a cyber criminal threatening them to do certain things unless big sums of money are transferred.

So, I think these are all good steps. You're probably right with a little bit of scepticism around timing, but it's a step in the right direction and that's why I'm welcoming it.

Leon Delaney

It is indeed a step in the right direction. Bruce, thanks very much for your time again today.

Bruce Billson

Good to be with you, Leon, and your listeners.

TRANSCRIPT: Banking announcement to fight scams, small business conditions

Emily Carter — Fri, 24 Nov 2023 05:46:26 +0000

TRANSCRIPT: Banking announcement to fight scams, small business conditions Emily Carter Fri, 11/24/2023 - 16:46

24 November 2023

TRANSCRIPT

Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson interview with Tom Connell.

Sky News

24 November 2023

Tom Connell

Banks have introduced sweeping changes in a bid to better protect customers against costly scams. Almost $430 million have already been lost to scams this year. Joining me live is Bruce Billson, Australian �Թ�� and Family Enterprise Ombudsman. Bruce, thanks as ever for your time. I think this is something people won't realise existed previously, that it doesn't matter what you put in the name, it can be absolutely anything basically, if the numbers are a bank account, the money goes out there. I know a family member that's transferred money accidentally the wrong way, they got a number wrong, and it still goes out there. How has this taken so long?

Bruce Billson

Some of the banks have actually had more advanced technology Tom than others and put a little cautionary flag where some of the transactions don't quite ring true. But this announcement on the eve of Scam Awareness Week is really welcome. It is one step of many needed to protect citizens and small and family businesses from some of these cyber threats.

And a really common one is where a cyber hacker gets into a business's software. They go to issue an invoice but the hacker has silently changed the banking details. It looks all quite legit. The customer at the other end is expecting the invoice. It's coming in the shape and style and with the price, the value on it, you expect, and people just go and pay it without realising it's been compromised by substituting a hacker’s BSB and account numbers. That payment is made and within moments it then gets usually shunted offshore and converted to crypto.

So some of these announcements are really good. This is a model that operates in the UK. The banks also have come together to think about pause mechanisms if someone oddly changes authorities for payment or things of that kind, which might be the consequence of someone bribing them or maybe forcing them to do things they didn't want, or that someone's accounts had been taken over by a hacker.

Tom Connell

That example is a really common one, that you spoke of. Intercepting, getting between the email getting sent out by the business and the person receiving it, which then of course often will put a business out because the individual says, I got sent an invoice from your email, it's not my fault I paid the invoice and that leaves the small business out of pocket.

And again, it seems like such a simple change because they don't match up. Even if there was an issue and they’ve changed bank account names, it's better to sort that out rather than have the money go the wrong way. And as you say, in an instant the money's gone. Are there any changes on the horizon around that? Because on the one hand we want money instantly, right, and business want to get paid. But sometimes you realise the mistake’s made an hour later, but you can't do anything about it. Is there an element around, we almost need a delay back in there, depending on payments?

Bruce Billson

And that's part of the announcement that the banking industry has made, which we welcome. Building in some pauses where money is moving around there is a chance to recover. Using the example we just spoke about, many of our small business customers work with the Australian Financial Complaints Authority, and the banks would try and do whatever they can after the event. But if the funds are already gone, there's really limited options. So those ideas about pausing where there's a variation in authority to deduct or to make payments. Even big numbers Tom that bank hasn't seen the customer engage with before. These are the things that are being built in, you know, checks and safeguards on top of the practical things that we can all do, and particularly for small business.

We keep saying let’s hope people do the best they can do in their space. The banks have stepped up, that's great. The telcos are running what are called clean pipes initiatives where they cut off nefarious traffic wherever they see it. But also, for individuals, you know, thinking twice about who you share account access information with. I know our assistance team here have had a few cases where someone's been duped into believing the contact they were having through emails and the like was someone that they knew and that they could share access details to accounts or myGov and that would be okay. Turned out not to be the case.

There are two messages in that: careful about sharing any of those things designed to protect you with anybody. And then secondly, what steps can we take to mitigate the harm and the risk and the consequence.

So that's what's good about this. It's also what's good about the government's announcement earlier in the week with more help for small business in this space.

Tom Connell

Bruce, 30 seconds or so, how is small business doing overall?

Bruce Billson

Challenging economy right now, Tom. Plenty of headwinds out there. Margins are tight. A lot of people feeling what we know for citizens are cost of living pressures, they’re input costs for small business. And as budgets tighten, people are less inclined to engage in discretionary spending. Retail's probably going to be a little bit down over Christmas. But as you would see, the sales coming up over this weekend are quite timely. And you know, one thing you can count on Tom is the perpetual optimism of enterprising men and women. So, they're still up in about, but probably more headwinds than there is wind in their sales right now.

Tom Connell

They need a bit of Bruce Billson optimism and can-do spirit maybe. Bruce always appreciate your time thank you.

Bruce Billson

Thanks Tom.

TRANSCRIPT: Optus and small business, banking services

Emily Carter — Mon, 13 Nov 2023 01:42:32 +0000

TRANSCRIPT: Optus and small business, banking services Emily Carter Mon, 11/13/2023 - 12:42

10 November 2023

TRANSCRIPT

Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson interview with Leon Delaney.

Radio 2CC Canberra

10 November 2023

Leon Delaney

Australian �Թ�� and Family Enterprise Ombudsman, Bruce Billson, good afternoon.

Bruce Billson

Leon, fab to be with you and the Capital listeners of 2CC.

Leon Delaney

Obviously, Optus has not only dropped the ball here, they've dropped the ball badly and then having dropped the ball badly they failed to pick it up, because they weren't telling anybody anything for hours on end. And now yesterday at the end of the day, around 5:30 in the afternoon, they finally said, well, look, we'll give you 200 gigabytes of data. That's no help to small businesses, is it?

Bruce Billson

We think that's inadequate. The telcos generally, and Optus included, talk a really good game about understanding the vitality of good telco services for small family businesses. It's not just about making and receiving phone calls, Leon. Payment platforms are enabled, bookings arrangements, your ability to run your own business is often into interwoven into your telecommunication service. You've got digital data record keeping, the accounts, payroll, all these sorts of things. So, it's really much more than just being out of contact. It's out of capability to function as a business.

And what we were hoping for from Optus was that they would recognise that and come forward with a more tailored response for small and family businesses for whom many have suffered quite an important economic loss that needs to be part of the remediation solution.

Leon Delaney

It appears very much as if the CEO of Optus, Kelly Bayer Rosmarin, doesn't really understand the impact on small business.

She was talking in a television interview and responded to a suggestion that a barber had to close his store for the day in Sydney. And she said on Channel Nine, I'm disappointed that a barber couldn't do haircuts today, that seems like one of the few things you can do without connectivity. The point is he couldn't take payments.

Bruce Billson

Well, he couldn't take payments and he couldn't take bookings. I mean, the barber shop that looks after my diminishing hair, you book online and he's more of a creative sort to make something out of not much with my hair.

But their whole ability to engage customers is through a digital platform. So, there's an inability to actually let customers know that you're open, let them know that there is a capability to cut hair, make the booking and then receive payment, not to mention the business of running the business of a barber shop is so dependent on those technological links. So, I don't think that was the finest moment of the CEO. I do respect that the CEO's probably under enormous pressure right now, but I guess that's my point. In the sales pitch there’s a great appreciation of those dependencies as the telcos, including Optus, talk about how they get that, they understand that and they're here to provide the services.

When something doesn't go right, I guess I'm calling for the same degree of appreciation and understanding and that would see Optus open to the fact that some businesses have had red ink in their day because of the inability to use the service that they were supposed to get.

Now, if Optus isn't prepared to do that, Leon, your small and family business listeners should reach out to the Telecommunications Industry Ombudsman. That's a scheme that Optus is a member of. It's designed to deal with these sorts of complaints and where there is a financial loss, to raise those and to determine what is a reasonable remedy given that there's been a material loss which a business has been able to evidence, and the telco should do something about that.

Leon Delaney

That same barber shop also reported another problem, and that was that customers would come in and he would explain that he couldn't take a card payment and they would say, look, I'll go and find an ATM and I'll come back. They never came back because they couldn't find an ATM. And there's a report today that people are now taking aim at our big banks and complaining about the reduction in ATM services that we've experienced in recent years. They've been quietly shutting ATM locations and outsourcing it to third party operators.

Bruce Billson

Yeah, and in some cases not outsourcing them to anybody. I know in some regions they've lost about a third of their ATMs. They’ve also had a substantial reduction in the number of bank branches. And in some cases, the big banks say they're a branch, but they're not actually because they don't hold cash on site with no one there you can get services from.

This is this is part of the cashless economy conversation that's going on at the moment. That's fine when everything's functioning well. It goes back to that centrality of having functioning telecommunications, because you can't use all of those payment platforms, all of those ways of settling your accounts if the telcos aren’t operating. And Leon and your listeners would know over those horrible, horrible weeks of the bushfires and the like, similar thing happened where the telecommunications network was down. We're all urging businesses to digitise their operations to store data in the cloud and they're basically saying, well, how can we do all that when the pipeline between all that data and capability in our business is not functioning, the whole show comes to a grinding halt.

Leon Delaney

I have a T-shirt. It's got a great caption on it. It says this: there is no cloud. It's just someone else's computer. And the fact is, when that computer stops working, we're all stuffed, aren't we?

Bruce Billson

Well, we are. And I've got a t shirt that says, I live in Murrumbateman. There seems to be no clouds out there because it never rains. There's two t-shirts. But that's the issue that people are talking about, what the work arounds look like, what the contingencies look like.

I know when my wife and I were owning a retail business and the very circumstances that we talked about arose, you used to have something called a bank card slip. You know, that little piece of paper that you’d chuck into that clunky machine and try not to get your fingers caught in and you'd fill it out by hand and then shoot that off to the bank and you'd get payment, you'd hope, some stage down the track. Now that sort of manual work around is not evident these days, and that's what makes reliable and dependable telco services important and also some accountability when they don't function as they’ve been promised.

Leon Delaney

I know you got to rush off, but just a final question. What should Optus do to compensate small business owners and operators because they've suffered a real financial loss. Optus is going to have to pay some sort of financial compensation, aren't they?

Bruce Billson

That's right. And they should honour the scheme that they've signed up to through the Telecommunications Industry Ombudsman, where small and family businesses can bring forward evidence of the actual financial impact. And then the Ombudsman will set what's a reasonable figure as a remedy for those circumstances.

So, if your listeners are in that situation, Leon, that haven't got satisfaction directly through Optus, jump on the tio.com.auwebsite. You'll see there's a tab there for lodging a complaint. Have your information, have your records, even have readily available what that day’s trade looked like 12 months ago and say well this is what it looks like today, here’s the customer loss that we've suffered. This is my economic harm. How about you think about addressing that as a remedy rather than just giving me more data.

Leon Delaney

They'll be inundated with so many people trying to log onto that website, they'll probably crash it.

Bruce Billson

Well, I talked to the Ombudsman earlier today, just to see how they were going, and Cynthia's very able, but she's anticipating some very busy weeks and months ahead.

Leon Delaney

Bruce, thanks so much for your time today.

Bruce Billson

Thank you, Leon.

Ombudsman welcomes review of Banking Code Compliance Committee

Donna Acioli — Thu, 23 Dec 2021 02:15:59 +0000

Ombudsman welcomes review of Banking Code Compliance Committee Donna Acioli Thu, 12/23/2021 - 13:15

23 December 2021

Ombudsman welcomes review of Banking Code Compliance Committee

The Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson has welcomed the final report of the independent review of the Banking Code Compliance Committee (BCCC), which includes recommendations to improve small business representation and engagement.

A key recommendation in the Khoury review is the addition of a fourth member on the committee with expertise in small business.

The final report also includes a recommendation to revitalise the BCCC’s engagement with the small business and agribusiness advisory panel, highlighting a need to incorporate systematic ways of engaging with the panel particularly when developing strategy and planning inquiries

“We welcome the final report of the independent review of the BCCC, noting the adoption of two significant recommendations my office has advocated for,” Mr Billson says.

“Having a committee member with expertise in small business will provide balanced representation and help the BCCC meet community expectations.

“We are equally encouraged by the final report’s recommendation for the BCCC to engage more with the small business and agribusiness advisory panel, particularly when planning and conducting inquiries.

“The panel is critical to the committee’s purpose to monitor and drive best practice Code compliance. A greater understanding of the unique challenges faced by small business customers will enhance the work of the BCCC and help meet the needs of the small business community.”

In addition to the review of the Banking Code Compliance Committee, Mr Billson also welcomes the Callaghan review of the Banking Code, which includes recommendations around access to banking services.

“While there is work to do to improve relationships between small business customers and banks, and de-banking is still an issue for certain small business sectors,” Mr Billson says.

“The Code review recommends seeking a commitment from banks to communicate with the customer before denying a banking service or closing an account, with an opportunity for the customer to respond, in accordance with AUSTRAC guidance. In the case where a service is denied, or account closed, it recommends the bank give a reason. It finds these decisions should be on a case-by-case basis.

“My office also supports the recommendation the BCCC consider conducting an inquiry into banks’ performance in accordance with these commitments.”

Ombudsman shares RBA concern over small business access to finance

admin — Fri, 10 Dec 2021 04:16:18 +0000

Ombudsman shares RBA concern over small business access to finance admin Fri, 12/10/2021 - 15:16

17 March 2021

The Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson has backed the RBA’s plea to banks to treat small businesses differently to consumers when considering loan applications.

Mr Billson welcomed further scrutiny of small business access to finance pledged by RBA Assistant Governor Chris Kent in today’s address to the Australian Finance Industry Association.

“Finance is the oxygen of enterprise,” Mr Billson says.

“Mr Kent’s comment that access to finance for small businesses has been a long-standing challenge and is now tighter than before the pandemic, is correct.

“I support Mr Kent’s plea to banks to take a different approach to small business borrowers, given that even under the existing Responsible Lending Laws, banks are not obliged to apply the same serviceability requirements to small businesses that need to be applied to households.

“I also share Mr Kent’s concerns regarding the banks lengthy and onerous process to securing finance, including substantial collateral requirements.

“Of course we need to strike the right balance, but any move to loosen onerous restrictions on access to finance for small business would be positive.

“The RBA has noted it expects business failures to rise as government support measures are phased out. This highlights the critical need for small businesses to have greater access to finance, to provide the cash flow necessary to get through the coming months.

“Overall, we welcome the RBA’s acknowledgement of the important contribution the small business sector makes to the economy as well as its efforts to continue to monitor small business access to finance and their prospects more broadly.”

Ombudsman welcomes Commonwealth Bank announcement on least cost routing

admin — Fri, 10 Dec 2021 02:46:22 +0000

Ombudsman welcomes Commonwealth Bank announcement on least cost routing admin Fri, 12/10/2021 - 13:46

23 September 2021

The Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson today welcomed the announcement by the Commonwealth Bank that it will automatically lower costs incurred by small businesses and family enterprises with a turnover of less than $250,000.

The Ombudsman has repeatedly called on banks and other financial institutions to adopt what is known as least cost routing to slash the high and hidden costs associated with electronic card payments for small operators and family enterprises.

“I congratulate the Commonwealth Bank for hearing the feedback from the small business community and taking this first step which will help a section of the small business community. There is a lot more to be done though, and I urge all banks and financial institutions to address this critical issue,” Mr. Billson said.

“I also welcome the Commonwealth Bank’s announcement that it will waive three months of merchant fees for those small businesses hardest hit by COVID-19 lockdowns. This is a terrific early Christmas present.

“The use of cashless transactions, particularly tap-and-go payments, has dramatically increased due to COVID-19 and it is vital to ensure that all small businesses are being offered the lowest cost options from their service provider or financial institution.

“Many small businesses and family enterprises already operating on tight margins and battling the disruption to their businesses caused by COVID-19 can’t afford the added burden of paying higher than necessary fees for their financial transactions.

“The cost of these higher and hidden charges across the economy is many millions of dollars – money that could be better put to work to grow business and employment prospects.”

Banks offer certainty to small businesses impacted by lockdowns

Toby — Thu, 02 Dec 2021 01:59:33 +0000

Banks offer certainty to small businesses impacted by lockdowns Toby Thu, 12/02/2021 - 12:59

10 July 2021

The Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson has welcomed the banks’ ongoing efforts to support small businesses impacted by COVID-19 lockdowns.

The Australian Banking Association says banks will defer loan repayments for small businesses affected by lockdowns throughout Australia for three months.

“This is a positive initiative that will help many struggling small businesses stay afloat in these challenging times,” Mr Billson says.

“The banks’ commitment to support small businesses through this period is highly valued and is the kind of a key support element that could be incorporated into an agreed predictable and known national framework of support.

“Such a framework, involving both Government and private sector elements, step up as COVID-inspired economic constraints and introduced, up-levelled or extended that small and family businesses can count on when seeking to navigate these challenging and uncertain times

“I would encourage all small businesses owners who are experiencing financial difficulties to call their banks now to make the necessary arrangements.

“Home loan support, including deferrals on a month-by-month basis, is also available to small business customers.

“Banks are promising to support small businesses if they need it - so long as the loan is in good standing with repayments up-to-date or there’s a payment program in place.

“It’s encouraging to see our banks taking this proactive approach and leading by example.

“This consistency from the banks will help small businesses navigate and adapt to periods of uncertainty such as this.”