Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 

Minister's crack-down on loan sharks a crack-up

Minister's crack-down on loan sharks a crack-up


Loan sharks profiteering from our poorest communities will be laughing out loud as they read the ineffectual restrictions included in the latest version of the Credit Contracts and Financial Services Reform Bill.

Lenders who already have good systems in place will not be affected by the changes. Loan sharks also know they will not be affected by the improved protections for borrowers, including responsible lending practices, because their clients are most unlikely to be aware of their rights or understand what 'responsible lending' means. Unscrupulous lenders know
the borrower who is desperate to get the fridge or the car fixed, or food on the table for their children, will not grasp the significance of a daily 1% - 2% interest charge.

Dr Claire Dale, spokesperson for Child Poverty Action Group and a trustee of Nga Tangata Microfinance Trust says "We are pleased to see the introduction of clearer tests for unreasonable credit fees and default fees, and more clarity around the guidelines for the Courts to reopen 'oppressive' credit contracts. However, the clients we see at Nga Tangata often come from communities where 50% to 100% interest is a comparatively 'good' rate, so what would be unreasonable?"

These borrowers are 'oppressed' by high interest loans because they may have a bad credit rating, or are nervous about being turned away by mainstream banks. Loan sharks are likely to be the only lenders in walking distance.



The Government is targeting unscrupulous lenders by putting the onus on consumers to make informed decisions and to know their rights. The consumer also has to know where to go and what to do if those rights are impinged. A person borrowing from a loan shark cannot afford legal representation to pursue their rights when their goods are
repossessed or their house is stripped when their repayments are late. This makes the increased penalties for creditors breaching credit laws an empty threat.

Dr Dale says "There is no balance of power between loan sharks and their clients, so the role for the Government is clear. To provide genuine protection for consumers, the Government needs to cap interest rates, like most of the rest of the civilised world including Australia, USA, 21 European countries, Japan and South Africa." A maximum all-inclusive
charge for interest and administration would protect the vulnerable and desperate consumer, and put an end to the cruel and enduring financial torture so many of our poorest families are suffering. "It is time to mend these huge cracks in consumer protection."

--ENDS--

© Scoop Media

 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

PM Announces Royal Commission Into Christchurch Attacks

Prime Minister Jacinda Ardern has announced that there will be a Royal Commission of Inquiry into security agencies following the Christchurch terrorist attacks... The inquiry will look at what could or should have been done to prevent the attack, Ms Ardern said. More>>

Gordon Campbell: On Ridding The Net Of White Supremacist Propaganda

Although it won’t be a walk in the park, gun law reform will be an easier job than neutralising the Internet hate content that (a) recruited the Christchurch shooter, and (b) confirmed him in his beliefs. More>>

Friday: National Remembrance Service

A National Remembrance Service for the victims of the Christchurch mosques terrorist attack, and all those affected by it, will be held at 10am on Friday 29 March, Prime Minister Jacinda Ardern announced. More>>

SCOOP COVERAGE: CHRISTCHURCH MOSQUES TERROR ATTACK
For the Latest: Scoop Search - Christchurch
 

Gordon Campbell: On The School Climate Strike

Locally, the school strike has won a ton of support for bringing climate change to the fore. Yet the strikers don't want mere expressions of support. They want action. More>>

ALSO:

"Grabbed And Struck In The Face": Greens Co-Leader Attacked While Walking To Work

Green Party co-leader James Shaw was the victim of an unprovoked attack when he was walking to work in Wellington. More>>

ALSO:

████████ ████ ███: Latest OIA Statistics Released

The latest statistics cover 110 agencies that collectively completed 18,106 official information requests between July and December 2018, a 16.4% increase on the 15,551 requests for the previous six months. More>>

ALSO:

'Hit And Run' Inquiry: New Legal Action Over Secrecy

The lawyer representing the Afghan villagers in the inquiry into Operation Burnham has launched legal proceedings calling for a judicial review in the investigation. More>>

ALSO:

From Hydro Plan To...: Mokihinui River Land To Join Kahurangi National Park

A total of 64,400 hectares of conservation land in the Mokihinui River catchment on the West Coast north of Westport, including 15 km of riverbed, is being added to Kahurangi National Park. “Adding this area, roughly half the size of Auckland City, to Kahurangi is the largest addition of land to an existing national park in New Zealand’s history,” Eugenie Sage said. More>>

ALSO:

 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

InfoPages News Channels