The government has relaxed consumer lending rules accused of making it harder for individuals and businesses to get credit, but there are already complaints they are not going far enough.

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Amendments to the Credit Agreements and Consumer Credit Act (CCCFA) have been published in the Official Gazette to come into force on July 7.

They comply with changes to the Responsible Credit Code [https://www.rnz.co.nz/news/business/463104/lending-rules-that-hit-credit-approvals-to-be-eased-government-announces

approved by the government in March] after a chorus of complaints about the unintended consequences of the act.

The CCCFA came into force last December and was intended to protect vulnerable borrowers from loans with terms and conditions and interest rates that they could not afford.

But almost immediately there were complaints that the rules were too restrictive, the information required too intrusive and unreasonable, and the application processing time too long.

It has also been accused of driving down lending and a credit crunch.

The changes clarify what lenders should ask for and where to get information when assessing a borrower’s ability to repay a loan.

Lenders will not need to verify current expenses of recent transactions when evaluating future expenses, nor will current savings and investments be considered expenses.

The CCCFA changes were largely responsible for a decline in lending, saying there were seasonal influences and other factors.

However, the Bankers Association said the changes were not enough and would change little.

“The government’s hasty attempt to fix the problem did not make things any easier for consumers seeking credit. Instead, it raised hopes for a solution that was not forthcoming,” said Association Director General Roger Beaumont.

He expected the changes to mean little to most borrowers.

“This is because most of the existing requirements remain in place, which means customers will still need to provide detailed information about their expenses, which will lead to a more thorough process and more loan applications being turned down than before. before the December rule change.”

Beaumont said the one-size-fits-all approach for all lenders and all types of loans meant banks didn’t have the same discretion or flexibility as before.

He said they would await the outcome of the broader review by the Council of Financial Regulators.