Safer vehicle finance options and savings safety net trial
Hon Kris Faafoi
Minister of
Commerce and Consumer Affairs
Hon Carmel
Sepuloni
Minister of Social
Development
18 July 2018
MEDIA
STATEMENT
Safer vehicle finance options
and savings safety net trial agreed at industry
forum
Measures to trial a safety savings net for all New Zealanders and a plan that could create safe and affordable vehicle options including social leasing and community ride-sharing have been announced at the conclusion of the Financial Inclusion Industry Forum today. Banks and NGOs also agreed to improve access to simpler, safer credit for vulnerable people.
Minister of Commerce and Consumer Affairs Kris Faafoi confirmed the initiatives to be actioned at the conclusion of the day, thanking business, the community sector and the government agencies for their involvement.
“For the first time in New Zealand we’ve had business leaders, community agencies and the government sector in the room working together this way to improve people’s financial outcomes,” Mr Faafoi said. “I look at what has been achieved in one day and I am more convinced than ever that together we can stop the misery resulting from people having become trapped in bad financial situations.
“As a Government we have legislation underway to stop predatory lending and here today the community and financial sector is working on another piece of the puzzle that we need to solve - improving financial inclusion, both boosting people’s financial capability and creating safe and appropriate alternatives.”
The needs of vulnerable consumers around banking, saving, credit, and buying cars were topics discussed in workshop groups charged with finding alternatives. Some of the projects agreed for action were:
• Inclusive
Banking Products and Services – led by the Banking
Ombudsman
Banks identified ways they could improve access
to simpler, safer financing for vulnerable people to meet
their needs and agreed to collaborate widely with government
and non-government.
• Emergency Savings –
led by Commission for Financial Capability:
There was a
genuine desire to build a savings safety net for all New
Zealanders and strong alignment across all the sectors to do
this.
• Microfinance – led by Good
Shepherd New Zealand:
The organisations recognised they
have common objectives and a complimentary set of skills,
resource and experience. The group identified the need to
take a more co-ordinated and systematic approach to both
scale existing initiatives and fill gaps in the current
offering.
• Cars & Car Finance – led by
the Financial Services Federation:
Came up with three key
concepts for vulnerable consumers to access safe reliable
and affordable vehicles involving an affordable ownership
model, a social leasing model and a community ride-sharing
model and will make sure these ideas have a life outside of
the forum.
Mr Faafoi said that the collaborations agreed were a step-change towards making New Zealand a country where financial inclusion is a way of life.
“On behalf of consumers and this Government which intends to make New Zealand an inclusive society where everyone can thrive, I sincerely want to thank all the organisations here today. It is particularly pleasing to be here with my colleague Carmel Sepuloni, who is also working to improve New Zealanders financial capability through a number of MSD-led initiatives.”
Minister for Social Development Carmel Sepuloni said:
“Crippling levels of debt block vulnerable families
from home ownership, increase stress levels and cause family
problems. I welcome the financial services sector's
initiative, to work collaboratively with NGOs and Government
to offer safer lending and banking options.”
Fleur Howard, Chief Executive of Good Shepherd New
Zealand, offered Good Shepherd’s assistance with following
up on progress of the ideas and collaborations initiated.
Good Shepherd New Zealand is also working on a longer term
project to support organisations to develop more inclusive
products and services and improve financial inclusion.
Ministers Faafoi and Sepuloni have asked for a report back on progress of the initiatives, by October.