Senate to debate banking inquiry

The federal government is set to come under increasing pressure over a banking royal commission as crossbenchers prepare to introduce legislation for a rare form of parliamentary inquiry.

The Greens, One Nation, Nick Xenophon and Jacqui Lambie will introduce the private bill in the upper house on Wednesday to establish a commission of inquiry into banking and financial services.

Labor has been pushing for a banking royal commission but the government argues it would be a mistake, saying it would take years before customers saw any resolution.