Microfinance loans and solutions to problem debt
Helping people to access safer credit and reduce their debt are key parts of Building Financial Capability. Two inter-related services are available to help achieve these aims: Microfinance lending and Debt Solution services.
Affordable and fair loans
The Ministry supports two not-for-profit providers of microfinance loans with operational funding, and banks provide the loan capital.
All loans are totally interest-free, with no administration fees and no hidden costs.
Good Loans
A partnership between Good Shepherd New Zealand, BNZ bank and the Ministry of Social Development offer Good Loans for assets up to $7,000, to be repaid over 36 months.
Ngā Tāngata Microfinance
Ngā Tāngata is a charitable trust that offers a safe, ethical alternative to high-cost lenders. All applications must be made with the assistance of financial mentors.
Contact the Microfinance providers:
- Good Loans: Call 0800 466 370 or visit the Good Loans website for more information.
- Ngā Tāngata Microfinance: visit the Ngā Tāngata Microfinance website for more information.
Debt Solutions Services
Anyone with problem debt can access help through BFC services. The range of Debt Solutions Services include specialist debt support and loans for debt consolidation.
The aim is to benefit creditors and debtors, and the wider economy, by maximising the flow of potential payments to creditors while sheltering indebted individuals and whānau from the financial, health and social impacts of overwhelming debt.
Two types of service are available, with four specialist providers in total:
Debt Solutions specialised services
These services advise clients on debt solutions that can improve their financial wellbeing. Provider tools may include:
- support and debt counselling
- developing negotiated debt options including insolvency
- management of some/all of a person’s/whānau finances
- debt restructuring.
Contact the Debt Solutions specialised services:
- CAP Debt Help: Call 0508 227 111 or visit the CAP website for more information.
- Debt Relief Foundation: Call 0800 3328101 (0800 DEBT 101), email helpline@debtfix.co.nz, or visit the Debtfix website for more information.
Debt Solutions loan services
These services focus on lending and counselling that can support financial wellbeing:
- debt advocacy and debt counselling
- debt consolidation loans that enable consolidation of harmful debt(s) into affordable repayments.
Good Shepherd New Zealand offer interest-free DEBTsolve Loans up to $15,000.
Ngā Tāngata Microfinance work with financial mentors and other services to develop individualised debt consolidation and repayment plans for clients.
Contact the Debt Solutions loan services:
- Good Shepherd New Zealand: Call 0800 466 370 or visit the Good Shepherd website for more information.
- Ngā Tāngata Microfinance: visit the Ngā Tāngata website for more information.
Debt Solutions Services resources
Service Guidelines
These Service Guidelines provide information and guidance on every aspect of delivering the interim Debt Solution services.
Review into the effectiveness of Debt Solutions
MSD asked independent Wellington advisers Sense Partners to review the effectiveness of the Debt Solutions Services pilot in 2022. Their report is available here.
