With Tony Burke MP, Andrew Leigh MP, and Graham Perrett MP
In Australia, many people work long hours to send money back to family overseas.
According to the World Bank, remittances to developing countries are worth half a trillion dollars annually – twice the value of foreign aid.
These people deserve a safe and secure way for people to send money which doesn’t involve large portions being eaten up by fees from financial institutions.
Today we heard from members of Brisbane’s multicultural communities, including leaders in the African, Islander, Chinese and Filipino communities, about what changes they want to see made to the remittances system in Australia. People told us about the frustration of low-wage workers toiling to help out friends and family overseas, and being gouged by the banks. They reminded us how critical remittances can be for recipients in war-torn nations such as Somalia and South Sudan. More than once, we were told about those who had resorted to precariously carrying banknotes because they couldn’t get a good deal from the banks.
Australia’s multicultural communities want a simpler system, a fairer system – one which will put downward pressure on the cost of transferring money overseas.
Labor is exploring whether institutions should be required to offer full fee disclosure, stating a single fee per transaction, denominated in Australian dollars. This would include both the flat fee and the exchange rate spread (relative to a standard benchmark). It would be similar to the comparison rates we already enjoy when shopping for car loans, mortgages and credit cards.
There are good reasons for security controls on overseas transfers, but there is no justification for unreasonable profit gouging.
There’s no excuse for excessive and confusing fees - it‘s time to make remittances fairer, cheaper and simpler.