Traditional tapa cloth is often exchanged at special events such as weddings, funerals and significant birthdays or community events. File Photo / Jim Eagles
Traditional tapa cloth is often exchanged at special events such as weddings, funerals and significant birthdays or community events. File Photo / Jim Eagles
Pasifika families in New Zealand are increasingly falling victim to loan sharks and unscrupulous pawn loan agreements, with invaluable traditional items such as tapa cloth mats being lost, community workers say.
Tapa mats and traditional fine mats are a lucrative commodity in Polynesia with some worth thousands of dollars.
Many,however, are not for sale and only exchanged as tributes in funerals, weddings or birthdays.
They are looked upon as a sort of cultural sacrament passed on from generation to generation.
But now there are reports of Pasifika families losing these items to pawnbrokers as they lend their assets support their budgets.
‘People are desperate for money and can’t keep up’
“Financially, people are struggling,” an Auckland-based Justice of the Peace and Tongan community leader, Salote Lilo, said.
“People are desperate for money and can’t keep up with the high cost of living, so they will go for these pawn loans because they need the money,” she added.
Cultural items were typically lost after financially insecure clients agreed to unrealistic repayment plans, Lilo said.
Traditional fine mats from the Pacific. File Photo / Rebecca Zephyr Thomas
It was a clear case of vulnerable people being taken advantage of, she said.
“They are bound to use these tapa cloths because they’re in high value and they use it as security,” Lilo said.
“These loan sharks use it as an opportunity to scam them…sell it with less cost,” she said.
And it is not just Auckland that is experiencing this problem.
Hamilton-based financial helpline advisor Theresa Alaimoana said she had dealt with a number of Pasifika families who had had tapa mats lost to unscrupulous pawnbrokers.
Alaimoana said the problem was likely bigger than it appeared as many families did not come forward for help.
Traditional fine mats are also a lucrative commodity among Pacific communities and are used at significant events, such as the then Government's Dawn Raids apology in 2021. Then PM Jacinda Ardern is draped by a fine mat. Photo / Brett Phibbs
“It is irresponsible lending from the pawnbrokers who think they are doing a service by giving people a quicker alternative to bank loans,” Alaimoana said.
“People will be in a desperate situation where they need money quickly so they turn to a pawnbroker because that is the easiest way to get money.
“One of the families I worked with, they were given six weeks to pay it off with an interest rate of 20 per cent, so they had a very small period to pay off this loan at a very high-interest rate.”
Pawn loans like these are not illegal if transacted by registered brokers.
It is an issue that is currently being evaluated by the High Court in New Zealand after New Zealand’s Commerce Commission filed proceedings.
A pawnbroker, according to New Zealand’s Secondhand Dealers and Pawnbrokers Act, “means a person, who, in expectation of profit, gain, or reward, lends money on the security of goods of which the person takes possession, but not ownership” and “who is not a secondhand dealer or the employee of a secondhand dealer and pawnbroker.”
Culturally significant items off limits for Cash Converters
In a written statement, New Zealand’s Commerce Commission told RNZ Pacific it was waiting for a judgement to be made.
“As consumers borrow money under a pawnbroking contract, to what extent they are covered by the Credit Contracts and Consumer Finance Act 2003 is currently being determined by the Courts,” it said.
“The Commission is waiting on a judgment on proceedings we filed asking the High Court questions about how the CCCF Act applies to pawnbroking contracts; currently, the pawnbroking industry holds the view that their contracts are not covered by the CCCF Act in any respect.”
As of January 2024, there are 45 registered pawn loan shops in New Zealand. Worldwide, pawn shops endure a stigma of shady deals and stolen goods.
Cash Converters is a pawn company which promotes itself as a clean business.
“Cash Converters has, for more than 25 years, provided ethical and responsible solutions for New Zealand consumers who require access to short-term financial assistance,” the company said in a statement.
“Cash Converters very deliberately does not buy, pawn or sell culturally significant items including pounamu (greenstone), tapa and similar cloths from the Pacific islands and carvings made from greenstone, bone, pāua shell and kauri wood.”
