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The Greens are calling for the RBA to allow cheaper home loans by becoming a people’s bank.
The move would mean home buyers could borrow up to 60% of the cost of a house. The interest rate would be set at 3.5%.
In a bid to encourage more people to buy their first home, it would only be available for owner-occupiers and for people with no other properties. The loan would also be capped at $500,000.
Greens leader Richard di Natalie spoke at the National Press Club and called for government intervention in the banking sector.
He said: “Banks are now an essential service. They are the gatekeepers for first time buyers and aspiring small business owners. That’s why today the Greens are announcing our plan for a publicly owned bank. A people’s bank, that will give people access to affordable banking services while adding real competition to the banking sector.”
As part of his plan he said the RBA would be able to offer loans online and through Australia Post.
According to di Natalie the Royal Commission has shown the banking sector needs more competition, which he says his plan would provide.
He knocked back criticism over conflicts of interest by saying the RBA would continue to set interest rates, but individuals would still get a better offer than from any of the other banks.
Di Natalie added: “The people’s bank will give current and first home owners a much needed advantage over investors. It will help turn around the long, slow and steady decline of home ownership rates.”
