ACT Finance spokesman Rodney Hide said today that NZ Post's revised offer to franchisees showed New Zealand Post was now desperately behind schedule with the roll-out of Kiwibank.

"Kiwibank itself is in trouble," Mr Hide said.

"New Zealand Post has consistently said that the roll-out has been on track and that just one or two franchisees were disgruntled. Now executives have had to ditch their promise of 300 bank branches by May for "something over 200" .

"Their new offer is to pay the full cost of the fit-out for franchisees. Previously, the offer was for the franchisees to pay half the costs of the fit-out through an interest-free, five-year loan from New Zealand Post .

"The new offer won't help much. The franchisees' concern is the operating cost of the new bank - not the capital cost, which was to be interest-free anyway.

"These concerns still haven't been addressed. There are more than one hundred franchisees worried that the 53 cent transaction fee won't cover their operating costs. These costs include loss of retail space, staff time, and general overheads. Franchisees now receive $1.02 for every transaction they do for the Taranaki Savings Bank without any of the hassle of having counters and specially trained staff.

"NZ Post is still unable to explain to franchisees what will happen if bank transactions take longer to process than forecast. NZ Post still hasn't explained who will cover the extra insurance costs. NZ Post has not even finalised the contract for the franchisees to sign.

"More than one hundred small businesses are vitally worried that Kiwibank will badly affect their business bottom line. They feel they are being pressured to agree to the Bank, with the threat they will lose their franchise if they don't sign.

"Kiwibank is a political bank, not a commercial proposition. It's nuts that hardware stores, bookshops and chemists are suddenly expected to become bankers. Kiwibank is Jim Anderton's political baby. It's time he took some responsibility for the damage his mad political promise is causing NZ Post, the franchisees, and the taxpayers' back pocket.

ENDS

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