The report acknowledged that “while banks must make commercial decisions, they also have corporate social responsibilities”.
“The government continues to place considerable trust in banks to act as gatekeepers of the financial system and to provide banking services that Australian businesses and consumers need to participate in the Australian economy,” it said.
“As the responsible operator of this gatekeeping function, they must exercise appropriate risk management procedures and processes to ensure that core banking services are reasonably accessible across the community. Denial of banking services to some groups and individuals would increase the risk that they are forced to operate outside the formal economy.”
The report authors said banks should gain comfort in banking legitimate businesses in these sectors as Treasury and financial regulators continue their work to reform Australia’s payments, crypto assets, and other financial regulatory regimes.
While they acknowledged that debanking is a global challenge they said banks’ responses need to balance support for businesses with the need to appropriately manage financial crime and other risks.
“The agencies expect that the proposed package of policy measures, while not providing a complete solution to de-banking challenges, will have a positive effect and address some of the main frustrations experienced by the affected businesses,” it said.
“Some of the measures will also provide the government with more information on debanking practices and a foundation for any future policy measures.”
AUSTRAC said last year that banks’ anti-money laundering requirements should not be used to justify blanket bans on refusing to bank whole sectors, such as crypto, arguing such an approach is dangerous as it could actually increase money laundering and terrorism risks.
“AUSTRAC continues to discourage the indiscriminate and widespread closure of accounts across entire financial services sectors,” the financial crime regulator said in October. In April, it released a financial crime guide to help banks identify suspicious crypto activity.
