24 Jan 2018

Efeso Collins warns parents to avoid loan sharks

From Morning Report, 8:20 am on 24 January 2018

High interest finance companies have taken to social media marketing to target families struggling to pay for back-to-school costs. RNZ is aware of a number of businesses offering to cover the costs of items like stationery and uniforms with high interest loans. One company is advertising a $500 loan that would cost a family almost 50 percent more than the original borrowed amount. Manukau ward councillor Efeso Collins tells Susie Ferguson the loan sharks are very dangerous and tempting to parents in need.

"Parents are going to be desperate to find the money to be able to resource the kids so they can get to school," he says. 

"We're seeing a whole lot of people who are struggling at the moment, who are very scared that their kids are going to school without the necessary stationery.

"What [loan sharks] aren't telling you is if you default you pay up to 400 percent."