Loan Arrears Still A Big Concern For Kiwi Households

Tuesday, 22 July 2025, 10:03 am
Press Release: Digitalstream

Fresh numbers from the May 2025 Centrix Credit Indicator reveal that while some early signs of improvement are emerging in the economy, many Kiwis are still struggling to keep up with their debts — particularly long-term loans.

In April, consumer arrears sat at 12.43%, meaning around 483,000 New Zealanders were behind on at least one repayment. That’s slightly better than March, but not cause for celebration just yet.

More concerning is the number of people who are 90+ days overdue, which has jumped to 83,000, the highest since July last year.

Loansmart Managing Director Murray Greig says, “this is a clear sign that many households are still stretched thin and finding it tough to bounce back.”

Mortgage Arrears Show Slight Improvement

There is a little bit of good news. Mortgage arrears dropped to 1.49% in April, which means fewer home loan holders are falling behind. That’s 1,400 fewer past-due mortgages than the previous month.

But dig a bit deeper and the picture’s still mixed. Long-term home loan delinquencies (90+ days overdue) are up 5% year-on-year, and missed payments in the 30–59 day bracket are up 6%, suggesting some Kiwis are on shaky ground even if they haven’t fully defaulted yet.

Personal Loans: A Growing Pressure Point

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Arrears on personal loans are also creeping higher. In fact, they’ve now exceeded 10% for the second month in a row. While this is partly due to holiday timing (Easter and ANZAC fell at the end of the month), it’s still a reminder that many Kiwis are relying on short-term borrowing to get by.

When it comes to Buy Now Pay Later (BNPL) services, arrears remain stuck at 8.7%, unchanged from last year – but still very high.

What It All Means

Even though short-term arrears are trending down, long-term arrears are clearly on the rise. That’s a red flag.

When people can’t catch up after missing a payment or two, debt can quickly spiral out of control. It’s not just a financial burden – it becomes a massive stressor on everyday life.

Loansmart Managing Director Murray Greig says, “We’re seeing more Kiwis quietly slipping into long-term debt without a clear way out. That’s where smart solutions really matter.”

A Debt Consolidation Loan Could Be Your Way Forward

If you’re juggling multiple debts and falling behind, a debt consolidation loan can be a smart move.

It rolls all your existing debts – personal loans, credit cards, even BNPL – into one simple loan, with one regular repayment and a potential drop in total interest costs.

Key Benefits:

• One affordable repayment
• Lower interest rates
• Less stress, more control
• Help to improve your credit score over time

With interest rates starting from 9.95%, Loansmart provides fast, fair and flexible options to help you get ahead.

Let’s Make a Plan Together

At Loansmart, we’ve helped thousands of Kiwis regain financial confidence since 2008. We don’t just offer loans – we offer solutions. And we’ll work with you to find the smartest one.

• 3-minute application
• Approval in as little as 1 hour*
• Same-day payout options*

Want to see how much you could save? Use our loan calculator, or chat with our friendly team for a free, no-obligation loan assessment.

*Subject to responsible lending checks and criteria.

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