One hundred thousand no and low interest rate personal loans will be provided to low income Australians by NAB.
The move comes as part of the bank’s ambition to “improve the financial wellbeing of its customers and communities.”
NAB has allocated $130 million for microfinance products alongside Good Shepherd Microfinance, providing 26,000 loans to low income Australians over the past 14 years.
Now NAB have set a target of 100,000 loans within two years.
NAB Chief Executive Officer, Andrew Thorburn, said the bank wanted to “better understand the issue of financial resilience and how it could do more to help.”
“These loans are for items such as a second-hand car, fridge or washing machines – items that can seem small but they make a big difference.”
“Banks are central to the lives of Australians, including assisting them with some of the most important decisions they will make such as buying a home or starting a business.
“That’s why we have committed through our partnership with Good Shepherd Microfinance to provide 100,000 loans annually to low income Australians within two years.
“We are proud that through our long-standing partnership with Good Shepherd Microfinance, we’ve provided more than $212 million in no and low interest loans to over half a million Australians who need support.
“But as the research shows, there is more to be done and we are committed to helping,” said Mr Thorburn.
NAB research reveals Aussie financial insecurity
The big four bank’s commitment to low income Australians comes on the back of their research that found over 2.6 million Australians have no savings at all.
This leaves them “unprepared for a financial shock, such as an unplanned medical expense.”
Part 1 of Financial Resilience in Australia, research produced from a partnership with the Centre for Social Impact (CSI) at the University of New South Wales, has revealed the following:
- One in three (31 per cent) of Australians feel financially secure
- Fewer Australians are prepared for ‘a rainy day’, with only half having savings equal to three or more months’ pay.
- Australians are less financially resilient than in previous years, with over 2.4 million adults either severely or highly stressed about money than last year.
Chief Executive Officer at CSI, Professor Kristy Muir, said it is “concerning to see that Australians are feeling less financially secure.”
“Financial stress can have significant impacts on a person’s life. We know that a growing number of Australians are financially stressed and don’t have appropriate, affordable or accessible supports to help them survive a financial shock.
“It’s important that society has the right safeguards in place.
“By understanding more about what Australians need to help them access appropriate and affordable supports, they will be better placed to withstand financial adversity, and better equipped to face and bounce back from adverse events,” said Professor Muir.