Tom Bayliss works as a Principal Adviser, Financial Inclusion at Reserve Bank of NZ
Tell us about your role as Principal Adviser, Financial Inclusion at Reserve Bank of NZ and what got you into it?
I started in my role in January last year - prior to that I was working at MBIE and the International Labour Organisation. Financial inclusion is a relatively new topic for me and some parts of RBNZ but we are coming up to speed quickly, with lots of help from experts in this space (community groups, other policy people, industry leaders, and academics).
Last year we pulled together RBNZ’s first whole of bank Approach to Financial Inclusion. Our working definition of an inclusive financial system is where all New Zealanders have reasonable access to financial products and services that meet their needs. Financial inclusion can be having access to a bank account, having the option of using cash, having payment systems that work seamlessly, or for a small business to borrow money at a reasonable rate.
Helping with Our Approach to Financial Inclusion was a great opportunity to look at the different roles of a central bank – price stability, our stewardship of money and cash, setting rules for banks, and supporting electronic payment systems for example. In many of these areas we found we can directly or indirectly impact financial inclusion, and part of the focus now is how we get the right settings in place across work streams and financial regulation.
What is something people might not know about the work you do?
People may not have heard of the RBNZ’s work on financial inclusion and wonder what this means in practice. To give some examples, we have been looking at:
- Access to bank accounts, for example, we put in a submission on making it easier for young people to open a bank account.
- Access to cash, and how the cash system can best meet the needs of New Zealanders: Cash system redesign - Reserve Bank of New Zealand - Te Pūtea Matua (rbnz.govt.nz)
- Māori access to capital, such as efforts to bolster lending opportunities for Māori land owners.
There’s lots of good work going on, and we’re hoping to continue to build a picture of what financial inclusion looks like in New Zealand in coming months and years by gathering information on financial inclusion (noting there is limited data in NZ at the moment), kicking off new research, and factoring financial inclusion into our decision making.
What new trends are you seeing in this economic climate?
Depending on your circumstances and experiences, you may have previously found applying for banking or insurance products fairly straightforward, extremely difficult or almost impossible. We’ve been hearing signals that some NZers are facing significant and growing barriers to access financial products and services. For example, providing documents to prove who you are, getting an appointment at a branch to talk to someone in person, or depositing cash as a retailer can take more time (and money) than it used to. For some people, these barriers can be a hassle, but for others it can lock them out from having access to products all together. The current economic climate is also pushing some people into hardship or unaffordable debt, which can have long term consequences for financial exclusion.
What are you seeing would make the biggest difference for whānau when it comes to financial inclusion?
One of the biggest differences for me is around access to bank accounts. We’ve been hearing that opening (and maintaining) a bank account is extremely difficult for some people. We’ve heard that access to banking issues can affect New Zealanders in many different situations, for example young people (especially those in state care or without parental support), people going through insolvency and losing access to their bank account as a result, and former prisoners hoping to reintegrate in society. There are a range of countries where there is a universal right to a basic bank account, such as Canada, Australia, France, Denmark and the United Kingdom. Access to banking is an area where we are seeing growing attention in New Zealand as well, and recent reports such as the Westpac Access to Banking in Aotearoa, the Commerce Commission market study into personal banking services have been highlighting key issues.
Tell us about the most rewarding moment in your work
One of the most rewarding moments was when we released Our Approach to Financial Inclusion at the Central Bank Network for Indigenous Inclusion (CBNII) Symposium held in Auckland last year. The Forum is a partnership between RBNZ, the Bank of Canada, the Federal Reserve and Reserve Bank of Australia, aiming to promote collaboration on indigenous economic and financial challenges and opportunities. It was fantastic to see our collective work come together, and for Adrian to hold up our work on financial inclusion at RBNZ to the attendees from NZ and around the world.