Banks Should Stay Out Of Culture Wars: FSU Welcomes Bill To Protect Against Debanking
'The Bill addresses a real and growing threat to freedom of expression – the use of financial infrastructure to enforce ideological conformity. Access to banking services is essential for full participation in society, and ideologies should not determine if someone has access to these services or not.
'We've submitted, commending the intent of the Bill to prevent financial institutions from 'debanking' individuals or organisations based on ideological or political grounds. We've also offered specific concerns and recommendations to ensure the Bill effectively protects the right to freedom of expression. Private companies have the right to deny service, but in a captured market, common-carrier principles apply to prevent exclusion from essential services based on lawful beliefs or expression.
'We've highlighted that particular wording risks inadvertently narrowing protection by listing only four prohibited grounds, which implies that other forms of discriminatory debanking remain permissible. We recommend that a broader definition replace this one so that banks cannot treat any consumer less favourably based on their ideologies.
'We've recommended that consideration be given to the popularity of financial institutions using ESG policies, and the risks these create in denying lawful individuals and businesses access to services, often based on disagreement with their views.
'We proposed that the Bill defines 'valid and verifiable commercial reasons' where an individual or business can be debanked, ensuring lawful expression is not included in this definition. Additionally, we added that safeguards should be in place, such as a requirement for written notice and time for a right of reply.
'The Bill has an opportunity to be a timely and necessary intervention to protect freedom of expression in the financial services sector. Kiwis should not risk being debanked simply for holding an opinion.'
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