Key stats:
DebtManagers’ customer-centred arrears management model created $248.5 million in social value for New Zealand.
The report found a social return on investment of $12.60 for every dollar invested.
Average customer debt rose 27% year on year, from $1,776 to $2,246.
Social value per customer increased 7%, while total social value increased 21%.
The largest drivers of social value were improved mental health and reduced debt.
Full research available here.
New research shows DebtManagers’ unique customer-centred approach to arrears management is creating nearly $250 million of social value for New Zealand, representing a social return on investment of $12.60 for every dollar invested.
DebtManagers is New Zealand’s leading purchaser of bad and difficult debt, supporting customers with overdue debts through fairer, more flexible repayment pathways, with no added fees or excessive interest. The analysis was carried out by ImpactLab, which measures the social value created by organisations across New Zealand. ImpactLab has assessed DebtManagers’ social impact annually since 2022, providing a longitudinal view of how the impact of its approach is evolving.
DebtManagers GM Commercial, Isaac Manase, says, “Bad debt has a cost far beyond the amount owing. It can affect a person’s wellbeing, confidence, mental health, employment, relationships and ability to participate fully in the economy.
“The flow-on effects hurt families and ultimately cost the country through higher healthcare and welfare costs, lost productivity, and more.
“It confirms that when customers are treated with empathy, understanding and trust, they are more likely to engage, more likely to find a realistic pathway forward, and more likely to rebuild control over their financial situation.
“For many customers, trust is built through human connection. Face-to-face contact gives people the chance to be heard, explain what is really happening, and work with someone who can understand their circumstances, recognise when extra support is needed, and help them take the next step.
“It is good for customers, good for the organisations that entrust customers to us, and good for New Zealand.”
Debt is becoming more complex
ImpactLab found average customer debt rose 27% year on year, from $1,776 to $2,246, reflecting higher levels of financial strain among customers at the point of engagement.
Despite this, social value per customer increased 7%, from $3,209 to $3,446, and total social value increased 21%, from $205.8 million to $248.5 million.
Manase says this reflects the growing need for debt management approaches grounded in the human reality behind financial hardship.
“As debt levels rise and customer circumstances become more complex, we are investing more in the support needed to help people resolve difficult debt before it becomes debilitating debt.
“It means taking time to understand each customer’s situation, setting realistic repayment arrangements tailored to their circumstances, addressing hardship and vulnerability, and connecting people with financial mentors and additional support when they need it,” says Manase.
Fairer debt management creates wider value
The report also found DebtManagers created measurable social value through five outcomes: Improved mental health, reduced debt, reduced hardship benefit, reduced risky behaviour, and reduced addiction, with improved mental health and reduced debt the largest drivers of value.
Manase says the findings validate DebtManagers’ belief that debt collection and customer rehabilitation should not be seen as opposites.
“For too long, debt collection has been seen through a narrow lens of payment, pressure, and enforcement. Our view is different.
“We believe good debt management is about rehabilitation. It is about helping people re-engage, understand their options, resolve what they can, and move forward with more confidence.
“The ImpactLab result validates what we see every day – fairer customer treatment creates better outcomes for customers, businesses, communities and the wider economy,” says Manase.
The full ImpactLab GoodMeasure Renewal report is available here.
