Centrix delivers some pre-Christmas cheer with data showing loan arrears are easing
Tuesday, 2 December 2025
The number of people behind on their loans, power bills and other credit contracts has dropped to the levels it was before the coalition of National, ACT and New Zealand First took power.
Credit reporting company Centrix gathers data from the likes of banks, power companies, insurers and telcos on whether people are staying on top of their financial obligations, and compiles reports on every “credit active” person in the country.
Centrix said data at the end of October showed 11.83% of the credit-active population was behind on at least one loan or bill, which was the lowest level in over two years.
That took arrears levels back to where they were in October 2023 when the general election took place, just weeks before coalition ministers were sworn in on November 27.
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Mortgage arrears had also fallen to a two-year low, with 20,900 mortgage accounts past due, and credit card and vehicle loan arrears were below their peaks earlier in the year.
Monika Lacey, chief operating officer at Centrix, said: “This marks the lowest arrears level in more than two years, with the rate now 2.5% lower than a year ago, signalling a strong pace of recovery.”
That still represented 459,000 people, and among them 177,000 were behind on at least one loan or bill by more than 30 days. That included 84,000 people who were behind by more than 90 days, just a little shy of the entire population of Palmerston North.
And, Lacey said: “New household lending rose 13.2% year-on-year, and mortgage enquiries remain elevated, as refinancing continues to be popular among borrowers seeking lower rates.”
Lacey said $3 in every $10 of “new” mortgage lending was refinancing, showing an increased appetite from households to shop around for lower home loan rates.
But there were indications that households remain cautious, and are reluctant to take on some forms of debt.
Lacey said demand for credit cards had softened, down 22.2%.
Demand for credit by households and businesses rose during the month, though company liquidations remained elevated.
“This a sign of both the persistent financial pressure many businesses are under, as well as increased auditing and enforcement by IRD,” Lacey said.
Economists, including those from the Reserve Bank Te Pūtea Matua, are expecting 2026 to be a year in which the economy improves, with households enjoying lower mortgage rates, and employment rates increasing.
Lacey said Centrix had identified encouraging signs of resilience and recovery.
She said reductions in the official cash rate, which the Reserve Bank dropped to 2.25% last week, had begun to positively reshape the credit environment.
Last week, departing Reserve Bank governor Christian Hawkesby told a select committee that the economy had “moved through a danger zone” that saw annual inflation climb to just over 3% in the three months to the end of September.
Finance Minister Nicola Willis acknowledged many New Zealanders would have liked recovery to have come sooner.