Public debate about debt targets in the banks

The issue of sales targets in the finance industry has been the subject of public debate this week, as the public and Finsec have challenged systems which encourages customers to take on more and more debt.

A survey of 4600 people by Buzz Channel reported in last week’s Sunday Star-Times that 58% of respondents had been offered unsolicited credit in the last year. 45% of those surveyed wanted law changes to curb predatory lending practices. Read the story here:

http://www.stuff.co.nz/sundaystartimes/4518309a6445.html

Finsec Campaigns Director Andrew Campbell talked to Radio Live and National Radio this week about targets and their effect on the economy. “A major overhaul of banks and other financial institutions lending practices and the regulation of lending needs to happen urgently. There is strong public support for change and there is no real defence for the unethical practices that many financial institutions have been engaging in,” he said.

“Changes also need to be made to banks pay systems that incentivise staff getting customers into debt. In most cases bonuses are linked to staff selling customers products like credit cards and in some case getting customers into debt is also linked to annual wage rises,” said Campbell. “We need to force banks and other finance institutions to behave in the best interests of customers and our economy through regulation. We also need an overhaul of employment practices, like debt targets.”

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