We are strongly supportive of work being done to improve financial inclusion for underserved customers. Many people throughout New Zealand struggle to access banking, many of whom are already vulnerable or in hardship. Through our services we see people who are forced to use family members or friends bank accounts instead of having their own.

Bank accounts are often the gateway to other financial products and services. In an increasingly digital world, lacking access to a bank account can lock people out of housing, employment, and utilities – especially when cash is no longer accepted. Access to these services is particularly important for people trying to rebuild their lives after an abusive relationship.

We are concerned that the $600 threshold has only been considered from a commercial perspective, not a social or ethical one.

Most people who approach us for financial support have several BNPL accounts in use, and they are often used to purchase essential items in the short term. It creates longer-term issues when several payments become due at the same time, and the lack of affordability checks from some services leads to missed payments and subsequent penalties.

Excluding people borrowing less than $600 ensures the most vulnerable New Zealanders, who have very few alternatives to purchase essential items, have none of the protections provided to people who will be borrowing more than $600.

The convenience and value of BNPL for middle-income New Zealanders, who have alternative credit options such as mortgages, personal loans and credit cards, is based on a business model that is subsidised by people in hardship continuing to pay significant default fees. 

The harm that is caused by unmanageable debt was the reason affordability assessments were strengthened by the Government in recent years, and these regulations should be extended to BNPL and other new forms of credit where harm can be caused by financial penalties being imposed on consumers.

We had three main points:

• Economic harm needs particular emphasis in the strategy and action plans
• The private sector needs to be identified as a key participant in the eradication of family violence
• A gender lens needs to be legislated across all areas of policy.