1
00:00:01,240 --> 00:00:03,560
Speaker 1: My name is Lily Maddon and I'm a proud Arunda

2
00:00:03,800 --> 00:00:08,560
Speaker 1: Bunjelung Cargoton woman from Gadigl Country. The Daily oz acknowledges

3
00:00:08,680 --> 00:00:10,799
Speaker 1: that this podcast is recorded on the lands of the

4
00:00:10,840 --> 00:00:14,400
Speaker 1: Gadighl people and pays respect to all Aboriginal and torres

5
00:00:14,520 --> 00:00:17,360
Speaker 1: Rate island and nations. We pay our respects to the

6
00:00:17,360 --> 00:00:20,120
Speaker 1: first peoples of these countries, both past and present.

7
00:00:25,320 --> 00:00:27,840
Speaker 2: Good morning and welcome to the Daily os. It's Tuesday,

8
00:00:27,880 --> 00:00:30,240
Speaker 2: the twenty third of May. I'm sam, i'm zara. The

9
00:00:30,280 --> 00:00:33,040
Speaker 2: federal government has announced the crackdown on buy now, pay

10
00:00:33,120 --> 00:00:36,560
Speaker 2: later schemes, which are set to be regulated. The charity

11
00:00:36,600 --> 00:00:39,240
Speaker 2: Good Shepherd found in the survey last year that around

12
00:00:39,280 --> 00:00:43,120
Speaker 2: seventy three percent of their clients had sacrificed essential items

13
00:00:43,200 --> 00:00:45,600
Speaker 2: or payments in order to pay off by now pay.

14
00:00:45,560 --> 00:00:49,400
Speaker 3: Later debt and further in debt that they find themselves in.

15
00:00:49,440 --> 00:00:52,080
Speaker 3: The more stress there is, and that leads to health

16
00:00:52,120 --> 00:00:55,880
Speaker 3: problems and a lot of other associated issues that come

17
00:00:55,920 --> 00:00:56,560
Speaker 3: with hardsheed.

18
00:00:56,920 --> 00:00:59,880
Speaker 2: So will the government's reforms go far enough? We'll let

19
00:00:59,880 --> 00:01:01,920
Speaker 2: you know in the d dive. But firs Ara, what's

20
00:01:01,960 --> 00:01:02,639
Speaker 2: making headlines?

21
00:01:08,920 --> 00:01:13,000
Speaker 4: Legislation to ban gambling ads during sports broadcasts has been

22
00:01:13,040 --> 00:01:17,160
Speaker 4: tabled in Federal Parliament by Independent MP Zoe Daniel. It

23
00:01:17,200 --> 00:01:20,319
Speaker 4: comes after Opposition Leader Peter Dudden used his Budget reply

24
00:01:20,480 --> 00:01:23,520
Speaker 4: speech this month to propose tighter restrictions on betting ads

25
00:01:23,600 --> 00:01:25,000
Speaker 4: during sports broadcasts.

26
00:01:27,480 --> 00:01:30,600
Speaker 2: The number of Australian rentals available for under four hundred

27
00:01:30,600 --> 00:01:34,120
Speaker 2: dollars a week has slumped to record lows. That's according

28
00:01:34,120 --> 00:01:37,640
Speaker 2: to new data from property analyst firm prop Track. The

29
00:01:37,720 --> 00:01:40,560
Speaker 2: data was compiled from listenings advertised on real estate dot

30
00:01:40,560 --> 00:01:43,839
Speaker 2: com to AU in April of this year. It found

31
00:01:43,880 --> 00:01:46,280
Speaker 2: that just sixteen percent of rentals were under four hundred

32
00:01:46,319 --> 00:01:48,800
Speaker 2: dollars in April, compared to thirty point two percent of

33
00:01:48,840 --> 00:01:51,080
Speaker 2: rentals found to be under four hundred bucks in April

34
00:01:51,120 --> 00:01:51,880
Speaker 2: of last year.

35
00:01:53,800 --> 00:01:57,080
Speaker 4: An Australian man has tragically died after reaching the summit

36
00:01:57,120 --> 00:02:00,560
Speaker 4: of Mount Everest. Forty year old Jason Kennison was climbing

37
00:02:00,560 --> 00:02:04,400
Speaker 4: Everest to raise money for spinal cord injuries Australia. Kennison

38
00:02:04,440 --> 00:02:06,560
Speaker 4: had learnt to walk again after being involved in a

39
00:02:06,600 --> 00:02:11,760
Speaker 4: serious motor vehicle accident back in two thousand and six, and.

40
00:02:11,720 --> 00:02:15,320
Speaker 2: Today's good news the rumors are true Researchers from UNSW

41
00:02:15,320 --> 00:02:18,560
Speaker 2: have found that drop bears actually did exist in Australian

42
00:02:18,639 --> 00:02:23,720
Speaker 2: rainforests just about fifteen million years ago. Fossil skeletons revealed

43
00:02:23,720 --> 00:02:27,480
Speaker 2: the creatures weighed about seventy kilograms and are similar to wombats.

44
00:02:27,840 --> 00:02:30,480
Speaker 2: Scientists believe they spent some of their time suspended from

45
00:02:30,520 --> 00:02:34,480
Speaker 2: tree branches like slots, occasionally dropping after losing their grip.

46
00:02:37,480 --> 00:02:39,640
Speaker 2: It's hard to shop anywhere in the real world or

47
00:02:39,680 --> 00:02:43,400
Speaker 2: online without seeing buy now, Pay Later services or BNPL

48
00:02:43,440 --> 00:02:46,160
Speaker 2: as we're going to call it today, being offered as

49
00:02:46,360 --> 00:02:47,480
Speaker 2: your payment option.

50
00:02:47,760 --> 00:02:50,880
Speaker 4: It is everywhere. It is omnipresent. I feel like if

51
00:02:50,919 --> 00:02:53,960
Speaker 4: a store doesn't offer it, then that's an anomaly. But

52
00:02:54,639 --> 00:02:57,760
Speaker 4: in case you haven't seen things like ZIP or Klana

53
00:02:57,960 --> 00:03:00,000
Speaker 4: or after pay and don't actually know what we're talking

54
00:03:00,000 --> 00:03:02,400
Speaker 4: talking about here when we say buy now, pay later,

55
00:03:03,000 --> 00:03:04,000
Speaker 4: what are we referring to.

56
00:03:04,160 --> 00:03:06,400
Speaker 2: So it's a financing option that allows you to pay

57
00:03:06,400 --> 00:03:09,680
Speaker 2: for items in multiple installments. The classic one is in

58
00:03:09,800 --> 00:03:13,680
Speaker 2: four installments rather than paying the entire amount upfront, And

59
00:03:13,800 --> 00:03:15,919
Speaker 2: essentially what it means is you can buy and use

60
00:03:15,919 --> 00:03:19,280
Speaker 2: something immediately despite not having fully paid for it yet.

61
00:03:19,400 --> 00:03:21,360
Speaker 4: Some could say you can buy now and pay.

62
00:03:21,240 --> 00:03:23,320
Speaker 2: Later much later in some cases.

63
00:03:23,880 --> 00:03:26,960
Speaker 4: So it's been around for years. I think I remember

64
00:03:27,000 --> 00:03:29,720
Speaker 4: when after FAY first came on the scene in Australia

65
00:03:29,880 --> 00:03:33,960
Speaker 4: and that was truly a defining moment for entrepreneurialism in

66
00:03:33,960 --> 00:03:37,720
Speaker 4: this country. Why is the government now deciding it's time

67
00:03:37,760 --> 00:03:38,400
Speaker 4: for regulation.

68
00:03:38,720 --> 00:03:43,120
Speaker 2: Well, yesterday the Minister for Financial Services, Stephen Jones, said

69
00:03:43,200 --> 00:03:46,520
Speaker 2: that while BNPL has its benefits, it's also presented a

70
00:03:46,520 --> 00:03:49,920
Speaker 2: whole new set of dangers and has gone largely unregulated

71
00:03:50,000 --> 00:03:53,560
Speaker 2: in the financial services space. In particular, there's concern about

72
00:03:53,600 --> 00:03:57,920
Speaker 2: the fact that BNPL products come with risks that disproportionately

73
00:03:57,960 --> 00:04:02,000
Speaker 2: impact women first nations, communit these and people on low incomes.

74
00:04:02,120 --> 00:04:04,160
Speaker 4: I know that you did an interview that goes over

75
00:04:04,280 --> 00:04:06,880
Speaker 4: all of those risks and we're going to highlight that

76
00:04:06,920 --> 00:04:09,640
Speaker 4: perspective in a moment. But I just want to come

77
00:04:09,680 --> 00:04:13,320
Speaker 4: back to this regulation because it is new and it's

78
00:04:13,400 --> 00:04:16,640
Speaker 4: a different way of dealing with this industry. So what

79
00:04:16,760 --> 00:04:19,520
Speaker 4: is the government actually proposing to do about regulating the

80
00:04:19,520 --> 00:04:20,800
Speaker 4: buy now, pay later industry.

81
00:04:20,880 --> 00:04:24,039
Speaker 2: Well, essentially it means that BNPL products are going to

82
00:04:24,040 --> 00:04:27,680
Speaker 2: be regulated as credit products, and what that actually means

83
00:04:28,000 --> 00:04:31,239
Speaker 2: is BNPL providers will have to hold a credit license

84
00:04:31,400 --> 00:04:35,120
Speaker 2: and will be able to be regulated under that government legislation.

85
00:04:36,200 --> 00:04:38,200
Speaker 2: Although I did want to point out that we're at

86
00:04:38,240 --> 00:04:41,880
Speaker 2: the beginning of this process and legislation hasn't been introduced

87
00:04:41,920 --> 00:04:44,680
Speaker 2: to Parliament yet, but draft legislation will be released for

88
00:04:44,720 --> 00:04:47,880
Speaker 2: consultation pretty soon. So to understand how the government got

89
00:04:47,880 --> 00:04:50,800
Speaker 2: to this point, you go back to last year where

90
00:04:50,920 --> 00:04:53,840
Speaker 2: Treasury laid out three options with how they could move

91
00:04:53,920 --> 00:04:57,000
Speaker 2: forward in regulating this space, may being the government. Yeah,

92
00:04:57,040 --> 00:05:00,359
Speaker 2: and the first option was to increase the industry, so

93
00:05:00,400 --> 00:05:04,239
Speaker 2: the BNPL industry's involvement in regulating themselves and a model

94
00:05:04,279 --> 00:05:08,919
Speaker 2: of self policing. Option two was limited regulation under the

95
00:05:08,960 --> 00:05:12,160
Speaker 2: Credit Act, and that's what the government has selected. And

96
00:05:12,240 --> 00:05:14,080
Speaker 2: option three was on the other end of the scale,

97
00:05:14,120 --> 00:05:17,479
Speaker 2: which was to bring regulation for BNPL products in line

98
00:05:17,520 --> 00:05:19,800
Speaker 2: with rules for credit card providers for example.

99
00:05:20,000 --> 00:05:22,799
Speaker 4: So there you're talking about a spectrum. So presumably option

100
00:05:22,839 --> 00:05:25,600
Speaker 4: one is like the lowest possible regulation if you're doing

101
00:05:25,600 --> 00:05:29,960
Speaker 4: it yourself, with option three being the most stringent regulation.

102
00:05:29,640 --> 00:05:32,440
Speaker 2: And they've picked right down the middle that option two,

103
00:05:32,600 --> 00:05:35,320
Speaker 2: and the Minister for Financial Services said that Option two

104
00:05:35,320 --> 00:05:38,919
Speaker 2: will get that balance right between maintaining people's access to

105
00:05:38,960 --> 00:05:42,760
Speaker 2: the benefits of BNPL whilst also introducing the proper safeguards

106
00:05:42,800 --> 00:05:43,200
Speaker 2: as well.

107
00:05:43,640 --> 00:05:46,280
Speaker 4: Australia at one point was really a world leader when

108
00:05:46,279 --> 00:05:48,400
Speaker 4: it came to the buy now, pay later industry. We

109
00:05:48,440 --> 00:05:50,680
Speaker 4: had after Pay, we had Zip, you know, Klana came

110
00:05:50,720 --> 00:05:54,760
Speaker 4: to Australia. There was really something there. What has that industry,

111
00:05:54,920 --> 00:05:58,279
Speaker 4: who obviously until this point haven't dealt with much regulation,

112
00:05:58,400 --> 00:06:00,679
Speaker 4: how have they responded to the announcement from the government.

113
00:06:00,920 --> 00:06:03,239
Speaker 2: Well, it's a little early to tell. As I said,

114
00:06:03,279 --> 00:06:05,640
Speaker 2: the government hasn't released detail on how they're going to

115
00:06:05,680 --> 00:06:09,360
Speaker 2: actually regulate the sector yet, and I think the providers

116
00:06:09,400 --> 00:06:11,359
Speaker 2: are all hoping that they'll have a seat at the

117
00:06:11,400 --> 00:06:15,760
Speaker 2: table for those negotiations. Some BNPL providers like after pay

118
00:06:15,800 --> 00:06:18,919
Speaker 2: and PayPal have largely been advocating for a more self

119
00:06:18,960 --> 00:06:21,880
Speaker 2: regulation approach through that Option one that I mentioned.

120
00:06:21,600 --> 00:06:25,479
Speaker 4: To be expected when we're talking about this spectrum of regulation.

121
00:06:26,000 --> 00:06:28,880
Speaker 4: We do have two TVs in our office and yesterday

122
00:06:29,360 --> 00:06:33,000
Speaker 4: saw zips founder all over the TV on every channel

123
00:06:33,040 --> 00:06:33,680
Speaker 4: that we have on.

124
00:06:34,040 --> 00:06:36,640
Speaker 5: We really do applaud the government. We do really believe

125
00:06:36,640 --> 00:06:40,320
Speaker 5: that Option two is a sensible balance between protecting consumers

126
00:06:40,320 --> 00:06:44,440
Speaker 5: from harms, delivering confidence to industry stakeholders, but also promoting

127
00:06:44,480 --> 00:06:45,839
Speaker 5: that competition and innovation.

128
00:06:46,080 --> 00:06:49,280
Speaker 4: So it sounds like the government has chosen the Goldilocks approach.

129
00:06:49,520 --> 00:06:51,320
Speaker 4: So they haven't gone for option one, they haven't gone

130
00:06:51,320 --> 00:06:53,119
Speaker 4: for option three, They've gone for something in the middle.

131
00:06:53,400 --> 00:06:56,200
Speaker 4: What are we hearing from critics of the buy now,

132
00:06:56,240 --> 00:06:59,120
Speaker 4: pay later industry? What do they think about the government's

133
00:06:59,160 --> 00:07:00,960
Speaker 4: decision to go forward in this way.

134
00:07:01,120 --> 00:07:03,000
Speaker 2: So one of the groups that had been really strong

135
00:07:03,160 --> 00:07:05,839
Speaker 2: in calling for tighter regulations in this space is an

136
00:07:05,920 --> 00:07:09,200
Speaker 2: organization called Good Shepherd and they're a charity that works

137
00:07:09,240 --> 00:07:13,400
Speaker 2: to support women and girls experiencing abuse and disadvantage. And

138
00:07:13,440 --> 00:07:16,560
Speaker 2: one of the functions that Good Shepherd offers is financial counseling.

139
00:07:16,680 --> 00:07:19,680
Speaker 2: So they've got a really good idea of how BNPL

140
00:07:19,720 --> 00:07:23,400
Speaker 2: products are impacting the most vulnerable Australians. When the government

141
00:07:23,520 --> 00:07:26,200
Speaker 2: was working out how to introduce these reforms, they went

142
00:07:26,240 --> 00:07:28,720
Speaker 2: out to the public and asked for a number of submissions,

143
00:07:28,760 --> 00:07:31,600
Speaker 2: and Good Shepherd were one of those bodies that filed

144
00:07:31,600 --> 00:07:34,520
Speaker 2: a submission representing the people that they were seeing in

145
00:07:34,560 --> 00:07:37,120
Speaker 2: their counseling sessions, and I wanted to hear a little

146
00:07:37,120 --> 00:07:39,800
Speaker 2: bit more about their perspective and their views on the

147
00:07:39,840 --> 00:07:41,960
Speaker 2: proposal that we have in front of us. So this

148
00:07:42,080 --> 00:07:45,200
Speaker 2: was the chat I had with Director of Research Advocacy

149
00:07:45,240 --> 00:07:48,160
Speaker 2: at Good Shepherd, Roz Russell. Hi, Roz, thank you so

150
00:07:48,240 --> 00:07:50,119
Speaker 2: much for joining us on the daily ODS this morning.

151
00:07:50,200 --> 00:07:50,880
Speaker 6: Oh are you're welcome?

152
00:07:50,960 --> 00:07:54,840
Speaker 2: Sam and So. Last year Good Shepherd investigated how buy

153
00:07:54,840 --> 00:07:57,960
Speaker 2: and now pay later schemes are impacting the financially vulnerable

154
00:07:57,960 --> 00:08:01,080
Speaker 2: and new submitted a report to a government quiet, give

155
00:08:01,120 --> 00:08:04,200
Speaker 2: me a sense of what you found on a top level.

156
00:08:04,560 --> 00:08:07,400
Speaker 3: Look at the top level, it reflects what's happening in

157
00:08:07,400 --> 00:08:10,920
Speaker 3: Australia overall, the vast growth of the use of this product.

158
00:08:11,280 --> 00:08:14,560
Speaker 3: But what we were alarmed about were the large numbers

159
00:08:14,560 --> 00:08:18,440
Speaker 3: of women who were accessing it to escape family violence

160
00:08:19,200 --> 00:08:24,440
Speaker 3: and also those who have experienced perpetrators using that product

161
00:08:24,680 --> 00:08:28,480
Speaker 3: in order to fraudulently or putting coercing them to put

162
00:08:28,480 --> 00:08:31,600
Speaker 3: the accounts in their name, so financial abuse. So they

163
00:08:31,640 --> 00:08:35,560
Speaker 3: were quite shocking for us. And I think that's something

164
00:08:35,640 --> 00:08:39,120
Speaker 3: different to what or what most of the providers and

165
00:08:39,160 --> 00:08:41,199
Speaker 3: the government realize that was happening.

166
00:08:41,400 --> 00:08:44,400
Speaker 2: So you're seeing by now pay later services more as

167
00:08:44,640 --> 00:08:48,880
Speaker 2: a symptom of underlying root causes that Yeah, yeah, sure,

168
00:08:48,920 --> 00:08:51,040
Speaker 2: staging vulnerable women exactly.

169
00:08:51,360 --> 00:08:54,560
Speaker 3: And what we found and that women were saying is

170
00:08:54,600 --> 00:08:57,959
Speaker 3: that they'd rather pay their accounts for by our pay

171
00:08:58,080 --> 00:09:01,280
Speaker 3: later so they don't get cut off, than paying for essentials,

172
00:09:01,280 --> 00:09:04,320
Speaker 3: well for other things. So that will come first because

173
00:09:04,320 --> 00:09:07,600
Speaker 3: there's no other choice when there's food to buy, baby needs,

174
00:09:07,840 --> 00:09:11,240
Speaker 3: essentials for the children, paying bills. It's a solution that

175
00:09:11,280 --> 00:09:13,040
Speaker 3: even if it's a short term and one that will

176
00:09:13,120 --> 00:09:15,760
Speaker 3: lead to further hardship, at least it fills that need

177
00:09:15,800 --> 00:09:18,679
Speaker 3: in that moment. So you know, women would have up

178
00:09:18,679 --> 00:09:22,520
Speaker 3: to seven accounts some of the clients, and that's just

179
00:09:22,559 --> 00:09:23,440
Speaker 3: not serviceable.

180
00:09:23,520 --> 00:09:25,400
Speaker 2: Well, I was reading in your report that eighty four

181
00:09:25,400 --> 00:09:28,800
Speaker 2: percent of people said that they had tried to manage

182
00:09:28,840 --> 00:09:32,200
Speaker 2: their debt by opening up another BNPL account. So that

183
00:09:32,320 --> 00:09:34,360
Speaker 2: really is that The image that comes to mind is

184
00:09:34,360 --> 00:09:35,520
Speaker 2: sort of treading water.

185
00:09:35,840 --> 00:09:37,320
Speaker 6: And not keeping ahead above water.

186
00:09:37,360 --> 00:09:39,959
Speaker 3: It's robbing Peter to pay Paul, and you can imagine

187
00:09:39,960 --> 00:09:44,040
Speaker 3: the stress that goes with that, and further in debt

188
00:09:44,120 --> 00:09:47,480
Speaker 3: that they find themselves in. The more stress there is,

189
00:09:47,559 --> 00:09:50,520
Speaker 3: and that leads to health problems and a lot of

190
00:09:50,559 --> 00:09:53,360
Speaker 3: other associated issues that come with hardship.

191
00:09:53,600 --> 00:09:57,360
Speaker 2: Okay, so ultimately, what were the recommendations from Good Shepherd

192
00:09:57,679 --> 00:09:59,720
Speaker 2: to rectify this situation.

193
00:10:00,240 --> 00:10:03,760
Speaker 3: Our option that we would have preferred is option three

194
00:10:04,360 --> 00:10:08,199
Speaker 3: from the options paper, which is really tight, same regulation,

195
00:10:08,440 --> 00:10:10,280
Speaker 3: same conditions.

196
00:10:09,760 --> 00:10:11,040
Speaker 6: As all credit products.

197
00:10:11,120 --> 00:10:14,920
Speaker 3: So they've chosen number two, which is you know where

198
00:10:15,000 --> 00:10:18,400
Speaker 3: we're still congratulating the government on at least moving in

199
00:10:18,440 --> 00:10:22,800
Speaker 3: this direction, but we are going to be watching with

200
00:10:23,120 --> 00:10:27,600
Speaker 3: very keen interest in what the modified regulations are that

201
00:10:27,640 --> 00:10:30,080
Speaker 3: they are going to that they're going to propose.

202
00:10:30,200 --> 00:10:32,319
Speaker 6: So we hope it's a bit.

203
00:10:32,200 --> 00:10:36,600
Speaker 3: More than just the industry self regulated code. We're hoping

204
00:10:36,600 --> 00:10:39,680
Speaker 3: that it's proper regulation because it is credit. So we're

205
00:10:39,800 --> 00:10:41,600
Speaker 3: going to wait and see what that looks like.

206
00:10:42,200 --> 00:10:43,840
Speaker 2: And it might be interesting to have a chat later

207
00:10:43,880 --> 00:10:46,680
Speaker 2: in the year to see what exactly your take is

208
00:10:46,760 --> 00:10:49,400
Speaker 2: on the regulation, because there's not a heap of detail

209
00:10:49,760 --> 00:10:51,199
Speaker 2: right now exactly.

210
00:10:51,440 --> 00:10:54,319
Speaker 3: And the other recommendations included, like you know, for women

211
00:10:54,440 --> 00:10:58,920
Speaker 3: escaping family violence if there was you know, sufficient support

212
00:10:59,000 --> 00:11:03,920
Speaker 3: there for amounts of money that enabled women to leave

213
00:11:04,240 --> 00:11:08,520
Speaker 3: and not have to return to a violent situation. That

214
00:11:08,559 --> 00:11:12,120
Speaker 3: would reduce the need for these products. So anything that

215
00:11:13,400 --> 00:11:18,040
Speaker 3: makes life affordable and can provide access to affordable credit

216
00:11:18,280 --> 00:11:21,480
Speaker 3: like we have our no interest line schemes, so if

217
00:11:21,520 --> 00:11:24,880
Speaker 3: that was more accessible and being able to provide a

218
00:11:24,960 --> 00:11:28,080
Speaker 3: wider support, that was one of our recommendations as well.

219
00:11:28,360 --> 00:11:28,560
Speaker 6: Rose.

220
00:11:28,600 --> 00:11:30,160
Speaker 2: I really appreciate your time today.

221
00:11:30,160 --> 00:11:40,000
Speaker 3: Thank you, Oh thanks Sam.

222
00:11:40,120 --> 00:11:42,400
Speaker 4: Thanks for joining us on the Daily Ods. If you

223
00:11:42,520 --> 00:11:45,760
Speaker 4: learned something from today's episode, don't forget to hit subscribe

224
00:11:45,800 --> 00:11:49,120
Speaker 4: so there's a TVA episode waiting for you every weekday morning.

225
00:11:49,600 --> 00:11:52,320
Speaker 4: We'll be back again tomorrow morning, but until then, have

226
00:11:52,360 --> 00:11:54,160
Speaker 4: a brilliant day.