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Yes Finance Welcomes New Regulations To Protect Kiwis From Unaffordable Loans.

The New Zealand Government’s move to ensure that anyone who wants to borrow money is guaranteed consistent protection is endorsed by finance company Yes Finance.

“Our goal is to ensure that your loan works for you and it’s reducing your debt,” says Yes Finance director Peter Steel.

Unaffordable loans

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:

• Make consistent inquiries about the borrower’s needs and objective to help ensure that the credit product is suitable.

• Verify the borrower’s income and expenses to be satisfied that the repayments are unlikely to put the borrower into significant hardship.

“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:

• Advertisements, loans and other consumer credit contracts.

• Record-keeping requirements for lenders around how they check whether it is likely a loan is suitable and affordable for a borrower.

• Helping borrowers to make informed decisions when taking on a new loan online.

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 endeavours 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.

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