Submissions

To: Reserve Bank
Date: June 2025

Purpose

This submission aims to provide feedback to the New Zealand Council of Financial Regulators on the Basic Transaction Accounts Issues Paper. DPA strongly supports the widespread availability of basic transaction accounts to enable disabled people, and other unbanked sections of the population, to participate fully in society and manage their finances autonomously, aligning with New Zealand's obligations under Article 12 of the United Nations Convention on the Rights of Persons with Disabilities (UNCRPD).

Summary of DPA submission

DPA welcomes the opportunity to give feedback to the New Zealand Council of Financial Regulators on the Basic Transaction Accounts Issues Paper. DPA strongly supports having basic transaction accounts available for unbanked sections of the population, including disabled people. They reference the "Westpac Bank Disability and Inclusion in Banking" report, which correctly identified that disabled people who are unbanked are unable to participate fully in society and experience barriers to participation on an equal basis. Removing these barriers would move New Zealand closer to meeting its obligations under UNCRPD Article 12, which stipulates that disabled people should have the equal right to manage their own financial affairs.

DPA agrees that customer onboarding requirements, such as ID and proof of address verification, are significant barriers for underserved groups, including disabled people, when opening accounts. They advocate for simplified onboarding processes and tailored customer due diligence requirements to make it easier for disabled people to open transaction accounts. DPA highlights that the $70 cost of photographic identification like the Kiwi Access card is prohibitive for many disabled people and others on low incomes, recommending further discussions between financial institutions, government, and stakeholders on ID affordability. They suggest that any form of identification with both a signature and a clear photograph, such as Total Mobility cards, should be acceptable.

The process for disabled people who are supported by co-signatories needs to be accessible and follow supported decision-making principles, with disabled people having ultimate authorization unless in exceptional circumstances. DPA agrees that greater efforts are needed by banks and regulators to improve access to basic transaction accounts, addressing the financial sector's aversion due to perceived additional costs. They emphasize the costs to unbanked people of not having accounts, including the inability to receive welfare and disability support payments.

DPA agrees with the World Bank's definition of a basic transaction account and the objective of promoting their widespread availability. Information about where to access these accounts should be made available in accessible alternative formats, including New Zealand Sign Language, Easy Read, Braille, large print, and audio. DPA agrees that all New Zealanders should have the right to access a basic transaction account and recommends that Government introduce legislation giving this right, imposing a legal obligation on all banks to provide such accounts.

DPA agrees with the minimum features outlined for basic accounts (e.g., simplified onboarding, no cost, online payments, direct debit). They recommend adding features like contactless payment options for all bank cards (benefiting blind/low vision people by avoiding PIN sharing), free in-bank transactions (for older/disabled people preferring cash or facing barriers to digital banking), and account information in accessible alternative formats. DPA recommends a hybrid approach involving both the financial sector and government to make basic transaction accounts widely available, with disabled people’s organisations (like DPA) designated as key stakeholders in future consultations to ensure the voices of disabled people are heard.

Key Recommendation/Finding:

DPA recommends that Government introduce legislation giving all New Zealanders the right to at least open and maintain a basic transaction account, making it a legal obligation for all banks and financial institutions.

Supporting Statement 1:

This would see the number of unbanked people in this country decline dramatically, allowing them to participate more fully in society.

Supporting Statement 2:

Disabled people experience significant barriers to banking, including prohibitive ID costs and difficulties with co-signatories, and without accounts, they may be unable to receive welfare and other government payments.