Supporting no-interest micro-loans

We partner with two organisations, Ngā Tāngata Microfinance Trust and Aviva, to provide interest-free, fee free microfinance loans to help Kiwis on low incomes reduce the burden of high-interest debt and get ahead.

What is microfinance and why is it important for Kiwibank to support them?

Microfinance are small loans that are designed to give people who wouldn’t normally get access to credit at banks access to safe, fair and affordable credit options. Kiwibank supports this sector by providing the loan capital for Aviva and Ngā Tāngata to lend to people who need it. For us, it’s critical to be able to use what we do best, finance, to support amazing organisations working in our communities to help people to get ahead.

This video was created in April 2018. Some numbers may have changed.

Who’s Ngā Tāngata?

Since operations began in 2011 Ngā Tāngata developed services that build financial capability. With Kiwibank as partners, they were able to offer no-interest no-fee loans to those in need. By providing Ngā Tāngata with the capital required to provide these loans, Kiwibank is able to give Kiwis a helping hand to get ahead outside of a commercial environment. With over seven years of collaboration, $1,000,000 in loans and more than 320 clients; we’re really proud of the work that we do with them.

Chief Marketing Officer for Kiwibank, Mark Wilkshire, said the programme not only provides people with a hand up, but it helps provide a support for people that can actually break the cycle of poverty.

Who’s Aviva?

Aviva is our microfinance partner in Christchurch, providing no interest loans for the Christchurch community to purchase essential items like washing machines and some housing related costs. Aviva works with clients to ensure they’re getting the support they need, including connecting them to other social services.

The loans are typically up to $1,000 but can be up to $2,000 in some circumstances.

They're part of a national network of social service organisations delivering Good Shepherd NZ’s NILS No Interest Loan Scheme, providing fair and affordable borrowing options to people living on low incomes

How do the loans work?

People need to be working with a financial mentor to receive ongoing support and budgeting help. However, sometimes this amazing service isn’t enough, and people need an additional relief. Ngā Tāngata provides no interest, no fee loans either for asset building (maximum $1500) or debt relief (maximum $3000). Almost 75% of the loans that they provide are for debt relief.

Since starting in South Auckland, Ngā Tāngata has expanded the availability of its interest-free loans to budgeting services in wider Auckland, Northland, Waikato, Bay of Plenty, Gisborne, Manawatu, Levin, Taranaki and Dunedin.

What’s the impact?

You've seen the numbers, and if you watch the infographic video you'll be able to start to see the direct impact but a recent evaluation that was done on the programme has proven the wide-reaching benefits of this support are not just financial. Ngā Tāngata's Executive Officer, Robert Choy said; "One respondent told us, ‘there is finally light at the end of a long, dark tunnel’,"

That reduction of stress - and the desire for a better future for themselves and their families - was a common theme in the impact evaluation. The lack of legislated consumer protection from the fringe lending sector, and the need for relief from debt-induced poverty, signal that Ngā Tāngata and Avivawill need to continue its mission for more years to come. And Kiwibank is happy to be on board.

Where can I find out more?

If you want to know if you're eligible for a loan or are interested in helping out: