Urban Rampage, the lifeline retail network for remote Indigenous communities in rural Australia, says the Australian Securities & Investments Commission's (ASIC) decision to maintain an interim stop order on the company's Centrepay facility indefinitely while it considers the matter is having a disastrous impact on its First Nations customers.
Centrepay is a long-standing Commonwealth Government scheme that allows people to buy essential goods and pay them off via regular deductions from Centrelink payments.
On Friday (March 15), ASIC extended an interim stop order against family-owned and operated Urban Rampage, which operate stores in remote communities in Queensland, Western Australian and the Northern Territory.
The regulator said it was working with financial counsellors from various organisations, including Anglicare which offers an invoice-based direct payment to supplier credit scheme underwritten by third parties including commercial banks.
However, Urban Rampage has been flooded with more than 80 formal complaints from First Nations customers who can no longer purchase essential goods on credit. More than 700 customers have also signed a petition asking for the service to be reinstated.
Urban Rampage's lawyer, Leon Loganathan from Ward Keller, said First Nations customers are very upset that this important service has been unilaterally terminated without any consultation with them. "It appears this is a case of shoot first and ask questions later. There has been no dialogue with the people most impacted by cutting off Centrepay as a payment option. This is very disappointing action by the regulator," he said.
"For many living in remote areas, Centrepay is not a mere convenience but a necessity, facilitating access to goods that we in the city take for granted but that are otherwise hard to access in those areas," Mr Loganathan said.
He said First Nations people in remote communities had very limited credit options while most other Australians had quick and easy access to buy now pay now later credit services.
"Click and pay for whites, and no credit for black fellas is how ASIC's Centrepay stop order is being viewed by First Nations people in remote communities. It's an uncomfortable truth for some, but a truth nonetheless based on the bare facts," Mr Loganathan said.
"This is another case of government effectively telling First Nations people how to live their lives. This basically says, you are incapable of making sound decisions using Centrepay so you can only pay for goods with cash. It is paternalistic and offensive to the vast majority of First Nation customers who have had no problems and rely on this service."
"This stop order strips these communities of their dignity, agency and right to financial and economic autonomy."
Mr Loganathan said the Centrepay ban became a political issue when Senator Louise Pratt from Western Australia put significant pressure on ASIC to take action specifically against Urban Rampage in the Parliamentary Joint Committee on Corporations and Financial Services last November.
"With due respect to Senator Pratt, she does not appear to have all the facts or understand how important the service is to First Australians in remote communities," he said.
"Urban Rampage does not sell fridges and TVs, neither is it selling drugs, alcohol or tobacco - just clothes and household items in a system that is perfectly designed to help First Nations Australians buy what they need and quarantine those payments away from the demand share economy that First Nations people operate in," he said.
"It would be nice to hear from First Nations politicians like Malarndirri McCarthy, Marion Scrymgour, and Jacinta Price as they would be eminently qualified to speak about the demand share economy and the important role the Centrepay deduction facility plays in addressing this issue."
Urban Rampage meets a need in remote communities
Many of Urban Rampage customers use Centrepay, which has become a critical credit solution for remote communities across Australia, offering a lifeline where traditional banking and credit services fall short. This interest-free and fee-free payment service, which allows the direct transfer of funds from Centrelink benefits to pay for goods and services, provides a secure and managed way to budget and ensures access to essential items - in areas where the nearest bank branch could be hundreds of kilometres away, and internet access may be unreliable or non-existent.
In a statement, Urban Rampage said:
"Centrepay helps to level the playing field by offering a form of credit that is fair and accessible. It does not prey on the financially vulnerable; instead, it provides a no-interest, flexible payment option that is sensitive to the financial ebbs and flows characteristic of life in remote areas. This approach to credit is revolutionary in its fairness and provides a template for how credit services should operate for vulnerable consumers who are at risk of financial hardship.
"Centrepay has been around since 1999 and there have been instances of unscrupulous operators contravening Centrepay's business terms. We are not one of those operators and can confirm that since we registered to use Centrepay in 2016 we have never failed a Centrepay audit. We have always strived to ensure we are on top of all compliance and regulatory matters and even engaged cultural consultants to help us improve our services in Indigenous communities.
"Our impeccable record with Centrepay since 2016 speaks volumes. Under our terms, customers pay no interest, no establishment fee and no penalty for non-payment. In fact, customers can stop payment at any time without penalty. It gives our customers confidence and flexibility. This is what makes ASIC's actions so disappointing, not just to us but to our customers as well."
Torrent of Complaints
The ASIC stop order has sparked a wave of outcry from customers who rely on Urban Rampage for essential purchases. The business has received more than 80 customer complaints in less than two weeks expressing dismay and frustration, and 733 petition signatures as of March 15, 2024. In one case, a woman was unable to buy funeral clothes.
One customer said: "Stopping my right as customer to purchase... I drove 3 hrs … to shop just to know Centrepay is not available at the moment."
Another customer said: "This is the only shop where bush people can get their stuff ... stopping Centrepay for them is just like putting bush people's life in difficult situation."
A Tennant Creek customer said: "I am very upset when I went to the shop for shopping today and they said Centrepay is suspended. The shop is being more helpful for us to get our daily needs. It is very unfair for the people like us who are living in a remote area where there is very limited access."
An elderly grandparent said: "We have been using this service for years and cut it out all off sudden … where I can get the clothes, kids stuff? … got three grandkids need underwear, walking on the street naked, there is a family funeral coming this Friday, where I can have these ? Rampage has been doing well with this service … it needs certain time to apply the rules … cut it all of sudden … do I need to Drive to Darwin to get clothes?"
And this from a First Nations person who drove 400km to shop only to be turned away: "Items of Urban Rampage come in handy. We buy here our basic needs like clothing, for the kids and family. Our community is far from Derby and I visit just to purchase our needs. I came here today, travelled 400km, just to know that I cannot use Centrepay in Urban Rampage."
And another: "I am happy to do Centrepay shopping with Urban Rampage. This is the only shop for the community people where we get our stuffs. I have my grandkids ready for school but because Centrepay shopping is suspended for them now, I am unable to get the clothes for kids. This is the only shop where I can buy the varieties of clothes. This suspension made our life difficult."
The torrent of complaints has reinforced Urban Rampage's position on the necessity of its services in remote communities.
"ASIC's decision seems to disregard the significance of Centrepay in remote areas. By unilaterally halting a service that has proven to provide a manageable form of credit, it potentially sets these communities back, cutting off the flow of goods and stifling the economic empowerment of individuals," Urban Rampage said.
"For communities that have historically been underserved by traditional financial institutions, the ability to access goods and services through Centrepay is a critical step toward equal economic participation. In this light, ASIC's stop order is not in the public interest and should be immediately revoked."
Key Facts:
Urban Rampage, the lifeline retail network for remote Indigenous communities in rural Australia, says the Australian Securities & Investments Commission's (ASIC) decision to maintain an interim stop order on the company's Centrepay facility indefinitely while it considers the matter is having a disastrous impact on its First Nations customers.
Centrepay is a long-standing Commonwealth Government scheme that allows people to buy essential goods and pay them off via regular deductions from Centrelink payments.
On Friday (March 15), ASIC extended an interim stop order against family-owned and operated Urban Rampage, which operate stores in remote communities in Queensland, Western Australian and the Northern Territory.
