NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / New Zealand

Is your suburb in the red?

By Cliff Taylor
Herald on Sunday·
18 Oct, 2008 03:00 PM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

Data showing which suburbs are most credit-worthy is being used by finance companies and banks.

Data showing which suburbs are most credit-worthy is being used by finance companies and banks.

KEY POINTS:

Ever wondered why you're no longer receiving enticing offers of cheap loans and expensive credit cards in the post? It could be that your suburb is in the red.

Marketing departments of banks and other lenders are using colour-coded "geo-risk" maps, to avoid areas of cities which have
high rates of credit defaulting. The maps, produced by credit reporting bureau Veda Advantage, clearly demarcate the areas of highest risk, which are then unlikely to receive mailouts with special offers of credit from lenders.

That means people may find themselves in an area identified as high-risk without them knowing it - and missing out on loan offers.

"Possibly people might be surprised," said Veda's New Zealand director John Roberts. "People are surprised we have credit files on them at all. Most people don't know until they get turned down for credit."

He said South Auckland and Canterbury currently stood out as high-risk areas.

Roberts said the company held details of more than 97 per cent of "credit active" New Zealanders (about 2.8 million people) and 400,000 companies.

Latest figures released by Veda show overall defaulter numbers have almost doubled since 2004 - signalling growing stress among New Zealand consumers.

Roberts believes lenders do take into account where people live in deciding whether to offer credit, although there are many other criteria.

"Your address does count but it is just one factor. They wouldn't just rely on that. They have their own policy rules - names, driver's licence, address, length of time at that address, employment, income, information on their credit file, bankruptcies, court judgments and so on."

He said the geo-risk information also encouraged "responsible lending" because extra credit was not being offered to people already up to their eyeballs and defaulting on loans.

"It's not sensible to put those offers into an area where there isn't a high tolerance for credit."

Roberts said the information was "very solid and specific" and there was a strong link between credit default and socio-economic factors.

On the Auckland geo-risk map, areas such as South Auckland, Glen Innes and Tamaki appear heavily "in the red", while central areas such as Remuera and Parnell are predominantly coloured in the low-risk blue and green.

A significant blob of red in upmarket Kohimarama represents an area of state housing.

Lending banks told the Herald on Sunday they did not discriminate against people applying for credit on the basis of where they lived.

Westpac spokesman Craig Dowling said the bank used geo-risk information "to ensure marketing money is targeted wisely... However, in terms of selling products such as credit cards, debit cards, personal loans or term deposits, we don't make any assumptions in any particular area.

"It's not appropriate to use general assumptions and apply them to individuals."

Kiwibank spokesman Bruce Thompson said his bank's key criterion was whether an applicant could service a loan or not.

"Supposing somebody in fulltime paid employment in a low income area is less able to service a loan isn't credible."

Blair Vernon, the BNZ's general manager of strategy and marketing said: "We don't use generic broad sweep data to make credit decisions - rather we use specific applicant data, since every applicant is unique and the credit behaviour of a neighbour is simply not relevant to another person."'

An ANZ spokeswoman said the bank's lending criteria was based on "serviceability". She added that geographical locations were "basically irrelevant".

David Tripe, from the Centre for Banking Studies, said that geo-risk models were actually "income maps".

"What a lender is going to do first is look at a person's income.

Since these areas largely reflect income levels, they are probably getting much the same message. Whether the geographic factors add anything to the information isn't clear."

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.
Save

    Share this article

Latest from New Zealand

New Zealand

'Game-changer': $56.4m irrigation funding unveiled

03 Jul 10:31 PM
Crime

'Ride a bike properly': Driver who left injured cyclist on the road claims he was the victim

03 Jul 10:27 PM
New Zealand

Ram raid targets Rotorua store overnight

03 Jul 10:21 PM

There’s more to Hawai‘i than beaches and buffets – here’s how to see it differently

sponsored
Advertisement
Advertise with NZME.

Latest from New Zealand

'Ride a bike properly': Driver who left injured cyclist on the road claims he was the victim

'Ride a bike properly': Driver who left injured cyclist on the road claims he was the victim

03 Jul 10:27 PM

Callum Anderson drove off without checking on cyclist who was bleeding and concussed.

Ram raid targets Rotorua store overnight

Ram raid targets Rotorua store overnight

03 Jul 10:21 PM
Seymour criticises Waititi for 'insane views' about African leader

Seymour criticises Waititi for 'insane views' about African leader

03 Jul 10:17 PM
Flood-ravaged Nelson, Marlborough in the firing line again, Auckland to see storms
live

Flood-ravaged Nelson, Marlborough in the firing line again, Auckland to see storms

03 Jul 10:16 PM
From early mornings to easy living
sponsored

From early mornings to easy living

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP