Should Kiwibank be the bank of last resort?

I’d rather the Government doesn’t own any banks (except the Reserve Bank) but as it does own Kiwibank, I’m wondering if it should be mandated to provide banking facilities to customers who can’t get banking service elsewhere?

Organisations and businesses simply can’t function without a bank account they can receive money in and pay money from. It isn’t a nice to have, but a must have.

The Herald reports:

The Bank of New Zealand’s chief executive has admitted the decision to deny a business account to a women-owned sexual wellness brand was the wrong one and strayed into acting like the “moral police”.

Girls Get Off, a New Zealand-based sex toy and accessory brand, had its application for a business account denied last week as the nature of its operations were “outside of BNZ policy”.

I don’t think banks should have policies about what types of customers they have, so long as they are law abiding. But a bank as a private company can decide otherwise. BNZ now refuse to allow Gloriavale to bank with them, and are saying they will ban petrol stations from 2030 from banking with them. In a few years their woke agenda may see them refuse to lend to dairy farmers.

Now this is in theory ok, if those declined at BNZ can bank with ANZ etc. But what if no bank will take them as a customer. You basically have the banks deciding who can and can not operate a business in NZ, rather than Parliament.

You could require banks as a condition of their licence, to not decline legal customers, but an easier way to deal with this problem is simply use the ownership of Kiwibank to direct that they can’t decline banking facilities for any legal customer.

So if a customer is fundraising for a terrorist organisation, they could still be declined. But if they simply provide a service a bank doesn’t approve of, they could not.