Rebuilding trust will take time - Wrightson

Convincing investors to trust finance companies enough to put money into non-guaranteed investments will be a slow process, says PGG Wrightson Finance chief executive Mark Darrow.

The finance business of listed rural supplies company PGG Wrightson became the fourth company to be accepted into the Government's extended retail deposit scheme last Thursday.

But it was the first guaranteed finance company to begin raising money from the public through non-guaranteed deposits in January.

Darrow said around $1 million per week had begun to flow in, similar to the amount it was getting through guaranteed deposits, and it now had around $10 million invested in non-guaranteed deposits.

"We are quite pleased with that."

Darrow said the challenge now was to move to a fully unguaranteed position. "Ultimately it has to grow to 100 per cent by the end of next year."

PGG Wrightson Finance has $280 million in debenture deposits and $125 million in bonds including its non-guaranteed deposits.

Darrow said the guarantee scheme had created a false security.

"It would have been better for us if it hadn't happened but the Government did what it had to do at the time."

Darrow said the first step in transitioning back to no guarantees was to offer both options and then it was all about changing consumer behaviour.

"Without the guarantee investors have to put their money where they trust the company."

Darrow said finance companies had to adhere to much tougher requirements now.