The New Zealand Government’s move to ensure that anyone who wants to borrow money is guaranteed consistent protection is endorsed by New Zealand-wide finance company Yes Finance.
According to Minister of Commerce and Consumer Affairs David Clark about 20 per cent of repayment difficulties experienced by New Zealand borrowers are thought to be due to the cost of having high debt levels.
The harm and stress caused by unaffordable and unmanageable debt is serious and long-lasting. Because of this the New Zealand Government wants to support all lenders to do a more comprehensive job of understanding their customers’ circumstances before approving a loan.
Before approving a loan, all lenders are required to:
“These requirements are a component of a set of changes to protect consumers from high-cost loans and unaffordable debt,” adds Peter.
Earlier this year, The Ministry of Business, Innovation and Employment (MBIE) published an updated guidance to help lenders comply with their responsible lending obligations. The Responsible Lending Code was updated to reflect changes to consumer credit legislation.
The Responsible Lending Code
The changes to this Code includes outlining what lenders need to do when their clients miss payments, exceed their credit limit, or experience unforeseen financial hardship.
Other changes to the Code include guidance on new legal requirements about:
The latest lending requirements will come into force on 1 October 2021 under the Credit Contracts and Consumer Finance (Lender Inquiries into Suitability and Affordability) Amendment Regulations 2020.
Yes Finance welcomes the fact that the requirements for companies that provide loans to consumers are clear and consistent. Yes Finance endeavors to provide the best responsible lending services to all of their customers, with competitive interest rates, flexible terms and a loan policy that is ideal for their client’s requirements.
Contact Yes! Finance:
Phone: 0508 10 50 10