Nick Bruining: Credit cracks for WA seniors appear in Cook Government’s solar battery rebate pack

Some West Australian seniors hoping to access the Cook Government’s new solar battery rebate scheme have been locked out of the offer after being rejected for interest-free loans by the Government’s nominated lender.

The scheme started on July 1 and has been pitched as a way to help low- and middle-income households store their renewable power, reduce their energy costs and aid in WA’s clean energy transition.

The revelation comes amid a series of investigations by Your Money into the restrictive practices of big lenders in providing credit cards and other loan facilities to those no longer in the workforce.

Despite many seniors having stable and reliable income sources — often backed by substantial assets — many WA retirees have had applications for credit declined with little or no explanation.

Under the State Government’s battery rebate scheme, no-interest loans for up to $10,000 are available to households with a combined annual income of less than $210,000. With loan repayment periods of up to 10 years available, household making full use of the program would repay about $84 a month.

Sydney-based Plenti was appointed by the Government as administrator and financier of the scheme, where households can receive rebates of up to $3800 and access the interest free loans.

Plenti and the State Government refused to reveal to Your Money the number of applications from those aged over 65 who had been rejected for the interest-free loans.

Energy Minister Amber-Jade Sanderson said the Government had targeted the scheme at low- and middle-income earners and conceded she was aware seniors’ applications had been knocked back.

“I have been made aware of similar concerns in relation to scheme access and will raise it directly with Plenti,” Ms Sanderson said.

Plenti chief executive Adam Bennett said the lender complied with its obligations under the National Consumer Credit Protection Act.

“Plenti assesses every applicant against the same credit and responsible lending criteria, regardless of age,” Mr Bennett said.

“Plenti has no incentive to decline credit, as this runs counter to both the intent of the scheme and our own purpose.

“Our focus is on assisting as many eligible customers as possible, but always in a way that is responsible and never to the customer’s detriment.”

Federal Age Discrimination Commissioner Robert Fitzgerald said he was aware the availability of credit for seniors was a serious issue.

“There are growing concerns by seniors that their financial needs, as they live longer, are not being properly considered by financial institutions,” Mr Fitzgerald said.

“The failure to provide consumer credit or other financial products based soley on the age of a person can be discriminatory, and possibly unlawful, depending on the circumstances.”

Australian Independent Retirees national president Margaret Walsh said similar problems with obtaining credit had been reported by members seeking credit facilities with a number of basic service providers.

“Our members tell of problems when dealing with other organisations who provide credit, including phone, power, gas and other utilities,” Mrs Walsh said.

Senior credit cracks appear for WA battery rebate pack

Warnbro resident John Wootton was delighted when the State Government announced the solar battery rebate scheme.

But delight quickly turned to anger when his application for an interest-free loan was rejected by the Government’s nominated lender.

The part-time university lecturer and his wife were quick to get their application in to take advantage of the loan offer — which is targeted at low and middle-income earners — when they opened on July 1.

“We wanted to install a battery to complement our existing PV system. Apart from the State grant, the deal offered interest-free loans, which was a great incentive to support the scheme,” Mr Wooton said.

Following a suggestion by his installer and instructions provided on a Government website, the Woottons made an application to the scheme’s third-party administrator Plenti for the interest-free loan.

“After supplying all our details — including unencumbered house ownership, Australian and UK pensions, plus our own superannuation income stream and plentiful access to casual work at Murdoch University — we were rejected,” Mr Wootton said.

“I received a response to my first rejection email with no clear reason provided why I should be rejected. I can only think it was because we’re part-pensioners.”

The Woottons confirmed they have an unblemished credit record, including a copy of a report from credit reference agency Equifax in their application to Plenti.

Mr Wootton’s complaint was then escalated to Plenti’s internal dispute resolution scheme — a mandatory process required of all Australian Financial Services licensees.

Plenti’s response to the complaint said it was not prepared to disclose the reason why the loan application was declined..

“Disclosing precise reasons for loan decisions may undermine the integrity of the scheme, as such information could potentially be used to circumvent the credit assessment process in future applications,” Plenti said.

The Woottons have been left to contemplate their next move.

“Part-pensioners like us will need to utilise credit cards or other high-interest means to join the scheme. This is despite the Government effectively endorsing the behaviour of this company,” Mr Wooton said.

Another credit provider, which asked not to be identified, said the rejected application could create issues for the Woottons later on.

“Most loan enquiries show up on your credit report and may affect your credit history if too many enquiries occur over a short period, without any corresponding loans to match,” it said.

Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association