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Centrix says consumer arrears rose to affect 11.9% of the active credit population in January.
Approximately 430,000 New Zealanders are behind on payments, according to the company.
That was an increase of 20,000 in a year, and the length of arrears was increasing slightly.
“While the arrears cycle tends to peak post-Christmas, the current arrears level is 6% higher compared to the same time last year,” Centric wrote.
“Although the increasing arrears rates are concerning, and something to keep a close eye on, it is important to point out that we are still below pre-pandemic levels.”
Centric adds the number of households behind on mortgage repayments in January was the highest since April 2020, with approximately 18,400 mortgage accounts past due.
This was a 22% year-on-year increase, which Cantrix said could be attributed to households rolling off fixed home loans and onto higher interest rates. The demand for mortgages was also down, with new mortgage applications falling 25.6% in the year to February. Total mortgage borrowing was also down by 24% though there were signs of a small uptick in January.
Business credit fell while arrears rose on unsecured personal loans, credit cards, buy-now-pay-later and motor vehicles.
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The problem has never been with the advisers, it has been with the finance companies and retail outlets who need to sell finance so they can meet their sales targets. THERE is a clear conflict of interest.
I am finding it harder and harder to hide my cynicism!