December 10, 2017
Micro loans helping whanau out of strife
A programme offering no-interest loans is helping low income families break the grip of loan sharks.
An evaluation of Nga Tangata Microfinance by the University of Auckland’s Centre for Applied Research in Economics found 80 percent of loan recipients who responded to its survey were women, mostly with dependent children.
Some 42 percent were Maori, with the remainder evenly split between Pakeha and Pasifika.
The majority said the loan made a huge improvement to well-being and peace of mind, and they could now spend money on more and better food and paying bills on time.
Executive officer Robert Choy says most borrowing from predatory lenders is for household necessities and in almost all cases Nga Tangata clients have taken on high-interest debt out of desperation and because there are no other options available to them.
Partnering with local budgeting advisors, Nga Tangata has disbursed more than $660,000 in no-interest loans to more than 300 clients, potentially saving them more than $1 million in interest and additional costs.
Capital for the scheme was provided by Kiwibank.
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