Stuff co.nz 9 September 2014
Labour reheated its loan-shark policy today, promising to cap interest rates to crack down on predatory lenders.
Under the proposals, it would be illegal to charge exorbitant interest rates to desperate borrowers.
Labour hasn’t set the maximum rate – that would be determined by the Reserve Bank, so that it could be changed without amending the law.
The plans would also result in a Labour-led government working with banks to establish social lending schemes, with low or no interest.
The policy mirrors Labour spokeswoman for consumer rights and standards Carol Beaumont’s Credit Reforms (Responsible Lending) Bill, which was voted down in 2010.
Beaumont said that unlike other countries, New Zealand did not set limits on interest rates.