Move improves Māori access to capital
The Reserve Bank (RBNZ) has welcomed a new practice note from the Māori Land Court designed to facilitate lending on Māori freehold land, marking a significant step towards improving Māori access to capital.
Clarifying lending processes
The Practice Note for Lending on Whenua Māori aims to demystify the complexities associated with lending against whenua Māori, providing clear guidance to landowners, lawyers, and the banking sector.
The Te Ture Whenua Act 1993’s protective measures for whenua Māori ownership have historically added layers of complexity to capital access. The guidance seeks to streamline the lending process, potentially opening new avenues for development and investment in Māori land.
See LinkedIn post here.
Simone Robber (pictured above), assistant governor/general manager of strategy, governance, and sustainability at RBNZ, highlighted the importance of the practice note in broader efforts to improve Māori access to capital.
“We are encouraged to see some retail banks picking up the wero (challenge) and working with Māori to lend on whenua Māori," Robbers said.
Addressing barriers to Māori business financing
RBNZ’s Issues Paper on Improving Māori Access to Capital previously identified several barriers impacting Māori in the business sector, including underrepresentation in business ownership and higher funding costs compared to non-Māori businesses.
The practice note is a step towards addressing these challenges by helping landowners, lawyers, and the banking sector understand the mortgage process on whenua Māori, potentially reducing transaction costs and broadening finance options for Māori landowners.
Read the RBNZ media release here.
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