Researchers call for loan shark regulation

first_img3 News 20 Aug 2012Loan sharks charging interest rates of up to 400 percent per  annum are exploiting Maori, Pacific and low income New Zealanders, Otago  University researchers say. The study by the university’s health promotion and policy  research unit in Wellington says the impact of loan sharks in low income suburbs  of South Auckland and other cities is affecting the health and well-being of New  Zealanders. “Loan sharks target and thrive in low income communities  because consumers are borrowing for everyday needs,” says lead researcher  Associate Professor Louise Signal. The study recommends tighter regulation of loan sharks,  including a cap on interest rates at 48 percent per annum, and introduction of  responsible lending requirements. The study also says more work needs to be done to inform  vulnerable communities about financial literacy and the risks involved with loan  sharks and borrowing. read more