“Financial hardship has started to rise again, after easing earlier in 2026.”
Personal loans are now the fastest-growing source of financial hardship, but mortgages remain the largest contributor – accounting for 38% of cases.
Personal loan hardship volumes have more than doubled since 2023 and are 46% higher year on year.
Figures from Inland Revenue show more than half a billion dollars ($537.9 million) was withdrawn from KiwiSaver for financial hardship reasons in the 12 months to June 2026.
Meanwhile, the number of people behind on their mortgage repayments fell to the lowest level since December 2022, Centrix said.
Mortgage arrears dropped to 1.19% of the active population, with 19,600 home loans reported as past due – 13% lower than a year ago.
Consumer arrears held steady at 10.74% of the credit-active population in August, with 424,000 people behind on repayments.
Overall arrears are now 11.2% lower than a year ago.
Lacey said the year-on-year improvement in arrears is “encouraging”.
Company liquidations remain elevated, with 3105 recorded during the year to August.
Liquidations are up 14% compared with a year ago on a rolling 12-month basis.
Construction accounted for 21% of company insolvencies during August, followed by hospitality (15%) and property, leasing and hiring (12%).
Lacey said business conditions continue to vary by sector.
“The construction sector shows early signs of improvement, with annual liquidation activity down 1% and larger declines across several building-related subsectors.
“This coincides with June-quarter GDP [gross domestic product] data showing construction activity increased 2.7% and made the largest upward contribution to economic growth, while hospitality and retail continue to record higher annual liquidation volumes.”
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