Business
4 December, 2024
Postcode discrimination must end, says Gulf mayor
Jack Bawden says the big banks must start to accommodate those trying to invest in regional and remote areas.
Carpentaria Shire mayor Jack Bawden says the state and federal governments will struggle to achieve the goal of developing Northern Australia until “postcode discrimination” by financial institutions is addressed.
Cr Bawden said there was a growing acknowledgment among some in government and the finance sector that there is a “stifling” struggle to access investment loans and capital across rural and remote areas – including as recently as in meetings in Cairns last week – but there is still no clear policy pathway being presented to overcome the troubles.
“I was in meeting with various groups in Cairns last week and there was discussion about how to allow more investment money to flow into northern Australia,” Cr Bawden told North West Weekly.
“I heard several at the meetings acknowledge the problem – but I don’t know if the message is reaching the people at the highest levels of government and the banks – because there isn’t a lot being done to fix the problem.
“How are we going to give a go to young generations if they cannot qualify for a business loan and how are older business owners expected to retire if they cannot sell their business because no one can get a loan?
“It is stifling the economy of the north and I don’t see how governments think they can develop northern Australia in the current situation.”
A spokesperson for the Australian Banking Association (ABA) denied there was “postcode discrimination” across the Gulf.
“Banks evaluate each mortgage application based on its individual merits, aligning with their risk appetite and adhering to responsible lending obligations,” the spokesperson said.
“The banking sector is committed to supporting economic growth in remote areas.
“The ABA and its member banks strive to balance the need for financial inclusion with the principles of responsible lending.”
As reported by North West Weekly, there have been calls for the Northern Australia Infrastructure Fund (NAIF) to lower its lending threshold in Queensland from $5 million to $1 million, as has been done in the Northern Territory, to allow small businesses across the Gulf, which make up the vast majority of the regional economy, to be built and expand.
It is also believed providing these loans as a “test case” underwritten by the federal government would prove to the reluctant finance sector that viable small businesses in the Gulf can pay back investment loans.
A NAIF spokesperson said it continued to work with “government partners at Commonwealth and state levels” to develop products similar to the Territory Infrastructure Loans program in the NT.
“While NAIF has and continues to support a number of smaller and family-owned businesses in our portfolio, we recognise that many people want to see NAIF do more for smaller proponents,” they said.
“We acknowledge that for many communities in the north, even smaller size deals have the potential of having a transformational impact on those communities.”