Community Law Welcomes Interest Rate Cap

September 3, 2019

Today’s announcement that the Government will introduce an interest rate cap to control high-interest lending will help vulnerable New Zealanders avoid crippling debt, according to Community Law.

“Short-term, high interest loans are the gateway drug for a lifetime of dependency on high debt and today’s announcement means companies offering these services will have to change that business model,” says Community Law Centres o Aotearoa Chief Executive, Sue Moroney.

“For the people we see at Community Law Centres throughout New Zealand as we support them deal with the legal issues involved in their crippling debt, this change can’t come soon enough,”

Community Law Centres o Aotearoa was one of many organisations that joined the call for an interest rate cap, led by FinCap.

Moroney says the decision will require Work and Income to ensure their clients are getting access to the correct allowances to help them in times of extreme financial stress and will also lead to more cost-effective, ethical services being developed.

“We congratulate Minister Faafoi and the Government for listening to submissions like ours at the select committee and responding to the need. It shows the importance of democratic participation by organisations working on the frontline.”
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