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Community Finance Initiative

The Community Finance Initiative aims to help people in financial hardship to borrow safely.

It provides affordable credit to individuals and whānau on low incomes (benefit recipients or wage earners).

The Ministry of Social Development, in partnership with Good Shepherd New Zealand, BNZ and the Salvation Army, offers two loan products:

  • No Interest Loan (NILS). This is a $1,000 loan, free of interest, to be repaid within 12 months.
  • StepUP. This is a low-interest loan (6.99%) ranging between $1,000 - $5,000, to be repaid over 36 months.

There are no fees charged for either of the loans. However, the lending criteria are different for each loan. The BNZ provides the loan capital.

Eligibility for a loan

People may be eligible to apply for a loan if the following criteria are met:

  • have the ability to repay a loan
  • be on a low income (from work or benefits)
  • hold a Community Services Card
  • have lived at their current address continuously for at least the past three months.

Loans can be used for purchasing higher cost assets (e.g. motor vehicles) or essential household goods and services, such as whiteware or for medical and health expenses. Individuals and families can only apply for these loans if other government agencies are not providing similar services.

Sites offering Community Finance loans

The Initiative is currently being delivered at the following sites:

  • Whangarei - Salvation Army
  • Waitakere (West Auckland) - Salvation Army
  • Henderson (West Auckland) - Vaka Tautua
  • Manukau (South Auckland) - Salvation Army
  • Manukau (South Auckland) - Vaka Tautua
  • Mt Wellington (South Auckland) - Salvation Army
  • Hamilton - Salvation Army
  • Tauranga - Salvation Army
  • Napier - Salvation Army
  • Palmerston North - Salvation Army
  • Wellington (City) - Salvation Army
  • Porirua - Salvation Army
  • Porirua - Vaka Tautua
  • Christchurch (East) - Aviva
  • Invercargill - Salvation Army.

Applications can be made via the Salvation Army, Aviva and Vaka Tautua.

Results from impact evaluation

The first part of the impact evaluation of the Community Finance Initiative has shown that it is helping low income New Zealanders to improve their financial capability and independence while saving thousands of dollars in interest.

The full evaluation will be made available when it has been finalised.

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