August 30, 2023
Māori business lending delinked from housing
Kiwibank wants to make it easier for Māori small and medium-sized businesses, including start-ups, to borrow.
Its head of Māori advisory, Teaho Pihama, says a 2018 report by the Reserve Bank identified growth in the Maori economy was held back by access to capital.has changed its lending criteria making
He says banks like to use residential property to secure lending rather than personal guarantees, but the Maori home ownership rate is relatively low.
“Recognising that Maori businesses are in that start-up, that small and medium enterprise space, (the bank) wanted to remove that as barrier to them accessing business lending, so now rather than (home ownership) being a prerequisite to a business loan it now just impacts the interest rates rather than the approval,” Mr Pihama says.
Kiwibank hopes the changes will remove barriers to self-employment and growing Maori businesses so whanau aspirations to home ownership, business growth or increased household income can be achieved.