Community finance to provide affordable credit to low income earnersSocial Development
Social Development Minister Paula Bennett announced today a new community finance partnership that will see interest free and low interest loans made available to New Zealanders who need them.
The Government is partnering with Bank of New Zealand, Good Shepherd NZ and The Salvation Army to develop a finance initiative that will offer people on low incomes affordable and sustainable credit. Good Shepherd will bring many years of delivering community finance programmes in Australia to the table.
“People on low incomes are vulnerable in their credit options with many tempted by easy finance. The initiative will see sustainable loans available for some people that might not otherwise be able to service a loan with high interest rates and hidden fees,” says Mrs Bennett.
Beginning with a one-year pilot, BNZ is committing $10 million to the initiative for up to five years that provides a real alternative to loan sharks and pay day lenders.
Today’s announcement honours commitments made in last year’s Budget to boost practical support for people on low incomes.
Mrs Bennett says this is the latest in a string of initiatives by the Government to help people access everyday necessities.
“We’re already helping beneficiaries and people on low incomes buy whiteware and more children are being fed in schools. Now we’re focused on increasing the wellbeing of families by assisting them to avoid unscrupulous lenders and their crippling interest rates,” said Mrs Bennett.