Tragic stories of the human impact of appalling lending practices have come to light in past weeks in the Banking Royal Commission and I expect there will sadly be more shocking revelations when the hearings move to Darwin this week.

The fourth round of Royal Commission hearings focuses on issues affecting Australians who live in remote and regional communities, which relate to farming finance, natural disaster insurance, and Aboriginal and Torres Strait Islander Australians interactions with financial services entities.

So far weve heard evidence of outrageous behaviour by Australias major banks and financial planners, including alleged bribery, forgery and selling insurance to people who cant afford it.

We have also heard cases of families being left homeless and cash strapped, of overstated valuations of properties more than 12 times their actual size. The banks have even had to admit that they have breached their own industry code.

Time and time again the bonus culture of the banks has been uncovered in the Royal Commission hearings.

This culture is a major factor in the continuation of the widespread unconscionable behaviour.

There is a serious cultural issue in the big banks and this Royal Commission is only the tip of the iceberg.

The Turnbull Government didnt want this Royal Commission to proceed, and they certainly did everything they could to protect their mates in big business.

The Senate can hold its head up high for leading the charge to help shine a light on the unconscionable conduct of the banks.

Labor from the outset has been critical of the banks and rightly so.

Time and time again we hear stories of heartache and stories of loss, both financial and personal. The Turnbull Governments reluctance to act hurt families preyed on by unscrupulous lenders.

To take another example of this governments negligence when it comes to lending practices , this Government has been promising since 2016 to give ASIC increased powers to crack down on dodgy payday lending practices and dodgy rent-to-buy schemes.

To date, it has failed to introduce this legislation.

Treasury officials couldnt provide an answer about when this vital legislation would be introduced at the May Senate Budget Estimates. All they could say was that it was a matter for government .

Claims that these loans help people get out of hardship ignore the fact that the cost of a payday loan is itself a significant financial burden for a person on a low income.

You could say that a low income earner who is trapped in a debt cycle has effectively taken a pay-cut courtesy of their payday lender.

A $300 payday loan typically requires a $372 repayment after 28 days. Given such a high repayment, it should be no surprise that a low-income borrower will borrow again, to meet a further shortfall created by the cost of the loan itself.

This is how payday loans trap Australians into an ongoing debt cycle.

Far from assisting them to overcome financial hardship, payday loans perpetuate hardship.

Only last week I read about new Cashngo machines being rolled out by payday lenders down south.

These machines are walkup loan machines where applicants provide very little personal information, a phone number, an email address and internet banking details and the next day they will have a $950 loan deposited in their bank account.

A high proportion of payday loan borrowers, almost 25 per cent, at last count, are Centrelink recipients.

As such, many borrowers are committing a significant proportion of their welfare payment towards repaying payday loans.

Many payday lenders target First Nations communities and families perpetuating financial hardship in many cases.

The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry should prompt financial sector institutions and advocates to reflect on the effectiveness and impact of lending practices.

I urge this Government to take action finally about some of the irresponsible lending practices that are rife.

Labor is committed to ensuring the Royal Commission delivers justice to all families and small businesses that have suffered because of the misconduct in the banking and financial services sector.

The Banking Royal Commission provides a once in a generation opportunity to create more fairness and transparency in an industry that affects every single Australian.

First published in the Sunday Territorian 1 July 2018.