Many women are ill prepared to deal with a major financial loss

 

Written by Dr Christine Nixon APM, Chair, Good Shepherd Microfinance

In February 2009 Victoria experienced the worst bushfires in Australia’s history. Known by many as Black Saturday, the fires took the lives of more than 170 people and 3,000 homes were destroyed or damaged.

As Chair of the Victorian Bushfire Reconstruction and Recovery Authority, I saw how ill prepared some women were in those communities to deal with major financial loss. I also saw within my own team how many of my colleagues had little or no experience in managing money and no real financial plans - no insurance, little superannuation and no savings.

I joined Good Shepherd Microfinance partly through my experience in the recovery effort but also through witnessing firsthand these barriers and challenges for women to take control of their own finances.

As Good Shepherd Microfinance and our corporate partner, NAB, started to produce research about financial exclusion, the big picture began to emerge. So many women were not supported by the way our financial systems operated. That so many had no access to fair and affordable finance. That a small problem like a broken fridge or washing machine could turn their lives into a crisis and send them to payday lenders or rent-to-buy schemes where the interest is extortionate.

At Good Shepherd Microfinance, we have started to talk about the big picture about how the financially excluded three million people in this country - mostly women and children - can be supported and included in our financial systems. How the government, business and community sectors could work together to find ways to overcome this exclusion.

Talking about financial exclusion is the first step, the second is to do something real and practical about it particularly for women and their children.

Our flagship program, the No Interest Loan Scheme (NILS), is a real, practical and accessible option for many women on low incomes. Some of their stories are highlighted in this edition of our newsletter. In fact, women represent almost 70% of our clients and many of them are single parents with children. After a NILS loan, women report improvements in their confidence, self-esteem and personal relationships.

In addition, it’s my goal for our organisation to help women improve their ability to cope with a major financial loss. It makes sense that the way to do this is through affordable insurance options for people on low incomes. The impact of the bushfires may have been lessened, just a little, if women and their families were insured. I’m looking forward to seeing our program, Good Insurance, grow and build scale with the support of leading corporate partners – Suncorp and IAG.

Everyone should have the opportunity to feel in control of their finances – whether they are dealing with a small problem or a major financial crisis.

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