The NZBA revealed that over two-thirds of consumer loans that had principal and interest repayments deferred due to the impact of the pandemic were now “back to normal,” and nearly 40% of consumer loans that had reduced repayments were also now back on track.

Association chief executive Roger Beaumont said trial regions were chosen on a range of criteria. “Some of that is geographic spread, so there’s two in the South Island and two in the North Island, and then we wanted to test different scenarios – scenarios where there was still one bank on town remaining, and also where there hadn’t been a bank in town for a year or two.”

More than two-thirds of mortgage and personal loans that had principal and interest repayments deferred due to the impact of Covid-19 were now “back to normal”, says the New Zealand Bankers’ Association.

More than two thirds of consumer loans that had principal and interest repayments deferred due to the impact of Covid-19 were now ‘back to normal’ said the New Zealand Bankers’ Association today.

At the same time, nearly 40% of consumer loans that had reduced repayments were now back on track.

“As we near the end of this extraordinary year it’s great to see that people who took up offers to defer or reduce their loan repayments are now getting back on track,” says New Zealand Bankers’ Association chief executive Roger Beaumont.

“Nearly 70% of deferred consumer and business loans are back to full repayments. People who reduced their repayments to get through are also making good progress.

“This shows that people who took loan deferrals, or reduced their repayments, understand why it’s a good thing to restart repayments if they can. It also shows how banks are working proactively with affected customers to support them through tough times.

“Banks will continue to work with affected customers to help get them back on track.”

As of 31 October:

• 69% of consumer loans (including home loans) that had deferred all repayments were back to full repayments
• 37% of consumer loans that had reduced repayments were back to full repayments
• 69% of business loans that had deferred all repayments were back to full repayments
• 50% of business loans that had reduced payments were back to full repayments.

In March, in consultation with the government, the Reserve Bank and credit reporting agencies, all New Zealand retail banks offered loan deferrals for up to six months and reduced loan repayments to customers financially impacted by the Covid-19 global pandemic. In August, the option of deferring loan repayments was extended to 31 March 2021.

ENDS

Banking Association chief executive Roger Beaumont said staff at the hubs will be trained to recognise potential financial elder abuse, and there will be systems in place to report concerns.

Robertson hoped the trials would be successful because he admitted online banking had meant many smaller branches were closing. “It’s not economic for the banks to keep branches open absolutely everywhere, so rather than have nothing, we’ve got the possibility of a hub like this.”

“There are some banks in small communities that I’ve heard of that don’t even have 10 customers a day. That’s unsustainable.”

A new banking hub launched today in Martinborough is being described as the possible future of banking in small New Zealand towns.

“Since March banks have been working proactively with customers who were financially impacted by Covid-19. Banks will continue to work with affected customers, including the relatively few who still have fully deferred loans.”

New Zealand Bankers’ Association chief executive Roger Beaumont said interest rates were at historic lows. “That’s good news for households and businesses looking to borrow. The flip side is that investors, including people who rely on interest income, get a lower rate of return on bank deposits.”