Banks act to stop financial abuse

Banks and insurers are changing their policies to prevent financial abuse, cutting off services when they suspect coercive control. 29 banks and 8 insurers have updated or are updating their terms to stop perpetrators from misusing their products, potentially impacting legitimate customers.

Financial abuse affects one in six women and one in 13 men in Australia, with an annual cost estimated at $5.7 billion—more than double the losses from scams. The misuse of financial products includes cancelling joint insurance policies without consent or using banking systems to send abusive messages. One major bank already blocks 400,000 such messages every year.

Companies outside the financial sector, including telecommunications and utility providers, are also making changes. Bundled phone accounts can be used to track victims, while utility bills are sometimes fraudulently placed in victims' names to saddle them with debt. New measures include helplines for affected customers and powers to suspend accounts when abuse is suspected.

Public demand for action is strong. The upcoming Respect and Protect Index 2025 found that 96% of Australians want businesses to prevent financial abuse, with 23% willing to choose service providers based on their response to the issue. However, while banks are leading the way, other industries are still catching up.

Following a national cabinet meeting last year, the government prioritised ending gender-based violence. Experts now urge both political parties to adopt stronger protections in their election policies, ensuring businesses take further action to close loopholes enabling financial abuse.

Source: Australian Financial Review, APH, Womens Agenda