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Indigenous financial inclusion: good for everyone

Amanda Young




The tragedy is that in this modern, affluent Australia, 43.1 per cent of First Australians are fully or severely financially excluded, compared to 17.2 per cent of the rest of the population. This means our First Australians cannot access a bank account, credit or insurance to leverage a better financial future.

There is an untapped market of 237,000 marginalised Indigenous people unable to access mainstream financial products and resorting to high-risk, short-term credit such as payday lending and consumer leases, locking themselves into the unwinnable task of extricating themselves from debt.

This is not only the story of remote Aboriginal communities. In our capital cities First Australians are also financially excluded.

How this happened is a journey across 200 years of government control of Indigenous wages and labour, with the complete exclusion from receiving paid wages resulting in a dearth of money management and wealth creation skills. It is not just a history lesson – the federal government persists to this day with policies such as benefit income control through Centrelink cards. “Protection” is a double-sided coin, with “dependence” on the flipside.

Many generations of Indigenous people have worked full, hard lives, and until as late as the 1980s didn’t receive their wages in hand. Wages went to the government to be held on trust, ostensibly to protect them from unscrupulous employers, to ensure they were not treated as slaves. At the end of these 40-year working careers, the net result was: there were no wages left.

Not only had First Australians had no opportunity to manage their own money, it was spent on their behalf by the government. In 2016, the government continues to control the income of Indigenous Australians through welfare cards, this time to “protect” First Australians from themselves.

Immigrant Australians – including those born here – by comparison, conduct lives that prosper with the assistance of car loans to access education and job prospects, home loans to grow the family wealth profile, and insurance from risk. They squirrel away for retirement, and entrepreneurs assertively grow wealth from capital and debt leverage. For mainstream Australia, the primary asset is the home, but Indigenous home ownership rates are very low. And for Indigenous people, superannuation retirement values are low, with less than 30 per cent likely to achieve ASFA “modest” levels, and high dependence on pensions in retirement expected. They are rarely able to maintain insurance.

Native title landholding rights have created a brighter prospect for those communities who have been successful in achieving legal ownership of their land. Royalties from exploration and mining are flowing and the estimated value of the sector (income and asset equity, not including investments) is $4 billion.

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    Yet even individuals receiving $50,000–$100,000 royalty incomes annually face the same historical challenge of low levels of awareness of financial products and services that can build a better financial future. There is also pressure to quickly upskill to the point of sophisticated financial knowledge to make wise choices to future-proof communities and exploit their landholdings for investment, consistent with community values of caring for country.

    Our task is to turn the tide of 200 years and build the skills of the first and second generations of Indigenous Australians to handle their own money to finally join the levels of participation of non-Indigenous Australians.

    The First Nations Foundation is proud to play its part. We consider ourselves the bridge between the financial services sector and First Australians and we hope to have both groups traversing the bridge for mutual benefit for many years to come. Our charitable aims are to build the financial literacy foundation for First Australians so they can engage meaningfully with your sector. We need your assistance with more accessible products and services to create an entry path for First Australians; for example the National Australia Bank’s microfinance and no interest loans.

    We need your superannuation funds to start collecting data on ethnicity so we can target Indigenous people with important messages about contributing to super. We need insurance options that are accessible to this market and its high-risk profile, to insulate them from risk. Most of all, we need your sector to lead and champion the way, partner with us and support our work. We run Indigenous money management training programs, hold a superannuation-focused event called Big Super Day Out (Sydney, June 2016; Melbourne, September 2016) and find solutions to financial exclusion.

    The financial sector has also been active, with work in the banking, superannuation and insurance space. In 2015 AIST hosted the inaugural Indigenous Super Summit and another is planned in 2016.

    If you want to donate or partner with First Nations Foundation please contact us at [email protected] or via our website. We would be delighted to hear of your interest. We know working in partnership with the financial sector is the best way to find the solutions that will give mutual benefit: inclusion of First Australians, and growth in the market.

    You can help us achieve the happy ending: economic freedom for First Australians.


    Amanda Young is the chief executive officer of the First Nations Foundation. 

    First Nations Foundation is not for profit, with deductible grant recipient status and works nationally towards the economic freedom of First Australians. For more: