One Lender’s Moves To Help New Zealanders understand what they are being charged by breaking down the confusion employed by finance companies and banks to hide complicated fees
Wellington, 13 April 2007 – Perweek.co.nz – A small finance company has laid down a challenge to major banks and finance companies to tidy up their act on disclosure and reduce their fees on loans and mortgages.
A new study from Fujitsu Consulting shows that New Zealanders pay more than 10 per cent on personal accounts than UK customers or those in other countries. They also pay more than they should on mortgages and other loans. Customers buying goods using consumer finance have always battled to understand exactly what they are paying for what. In fact, often the providers have done their best to make it as hard as possible to find and understand this.
Small, online finance company perweek.co.nz believes in ‘naked commerce’ whereby finance charges and deals are transparent. At present, according to Perweek CEO Peter Terpstra, customers are confused and befuddled by complex documents that often hide or conceal the true cost of borrowing. The Fujitsu report illustrates that New Zealand bank customers are not doing enough to drive the cost of lending down.
“Confusion as a marketing strategy isn’t just used for selling phones,” Mr Terpstra said. “Naked commerce such as Perweek’s permits a ‘Fair Deal Summary’ that is available to anyone before any commitment to buy is made. Technology such as ours lets a customer know exactly what they’re going to pay. If we can do it, then why can’t the major banks and finance companies”.
The current situation in New Zealand is unregulated and only the banking ombudsman can help with fees disputes.
“It’s a bad deal for the customer and a very good one for the banks,” said Mr Terpstra. “But technology can turn the tables. We’ve started, but we’re small. The banks need to take the challenge and until customers start walking to sites like ours with their fingers or otherwise, then nothing will change.”
“We are aiming to put customers in control of they way they want to pay and have the best technology to ensure that they have terms and a rate that is specific to who they are and what they are buying” says Mr Terpstra.
“We often hear the virtues of the “One to One” customer experience and this sort of technology takes it to the next level by offering customers a “One to One” lending experience that is tailored to their needs.
What this real time disclosure allows is for customers to design the payment method, term and deposit that suit them and be confident that they know what they are paying. No more inflexible vanilla HP agreements, Personal loan documents or credit card terms that require a degree in finance to decipher.
So, the challenge has been laid down by a new kid on the block, will the big banks and finance companies dare to entertain the thought of Finance in any other flavour than vanilla?
About Perweek.co.nz – Perweek.co.nz is an online shopping site designed to provide transparent finance to New Zealanders for their online purchasers. It is an awarded and designed to provide totally clear finance arrangements simply and quickly.
Contact: Peter Terpstra, CEO, Perweek.co.nz