Making a plan: preventing financial products used as weapons for financial abuse
/The Office for Women has released a resource for the financial sector to better understand the way financial products may be used to enact financial abuse of women.
The Guide to prevention and action on financial abuse within the financial services sector is for organisations to help guard against actions that are deemed financial abuse.
The guide was developed with women who have experienced financial abuse from an intimate partner where the partner controls the woman’s access to, use of or ability to control their finances. This type of abuse is typically not isolated and may occur alongside other forms of violence, or even continue after a couple has parted ways but financial ties are still in place, the Office for Women said.
The guide was created under the national plan to reduce violence against women and their children and offers companies a checklist to understand how their services might be used against a woman to perpetrate abuse.
The main principles include:
Build empathy and awareness. Listen and learn about the lived experiences of financial abuse victim-survivors. Build empathy and awareness into your financial service’s policies and practices.
Be inclusive and accessible. Design products, services and systems to support the different needs, experiences and capabilities of individuals experiencing or at risk of financial abuse.
Prioritise safety. Once you have a greater understanding of the issue, design your systems, services and products with Safety by Design principles, violence prevention and wellbeing in mind.
Act with integrity. Use a values-based framework to guide employees, system and policy decision-making when engaging with regulatory requirements.
Operate holistically. Guide customers throughout their service journey on the risks of financial abuse and how it can be best prevented or managed.
Take responsibility. Understand how the system can be misused. Take preventative action and build in ongoing reviews to update your understanding.
Champion for change. Lead by best practice and advocate for change within and beyond your organisation.
The goal is to prevent this type of abuse, despite many organisations having or developing plans to support women who are experiencing financial abuse and hardship as a result.
"By preventing your financial products and services from being used to perpetrate financial abuse, women will experience improved financial security and wellbeing while organisations benefit from the reduced need for financial hardship services," the guide said.
"Preventing financial abuse as an organisational priority means implementing values-based decision-making frameworks that prioritise safety."
As part of this process, financial services companies can develop products that are more accessible for the diverse needs, experiences and capabilities for women at risk of financial abuse. There is plenty of scope for leaders in women’s safety and ensuring gender equality in Australia is advanced.
A lack of awareness that financial abuse is a form of abuse means many victims are unaware that there is a name and support for their situation. According to the report, 623,000 adults were subjected to financial abuse by a partner or former partner in 2020. Abuse for females is higher than males, however males do also experience financial abuse. Gender norms where male partners handle the finances means many women are not aware of actions of abuse that may be occurring or deem the situation of their lack of control over finances as ‘normal’.
In 2020, the total cost of financial abuse to victims in Australia was estimated at $5.7 billion, with a further $5.2 billion in broader economic costs.
