"PAY AS YOU GO”

Evening Star, Issue 21401, 3 May 1933, Page 6

"PAY AS YOU GO”

STATE ADVANCES INNOVATION HOUSE COLLECTION FROM CLIENTS [From Our CorkbspohdkntJ WELLINGTON, May 8. The exceptionally difficult condition of things to-day throws even the most conservative of institutions into now methods. Years ago it would have been regarded as almost laughable that the State Advances Department, with its dignified method of debiting clients every half-year, and expecting a cheque in due course, would have adopted a house-to-house system of collecting. But the department, adapting itself to the needs of many of its clients, now gives them the opportunity of “ paying as you go,” and will collect its instalments on tho doorstep. It is difficult to say how many of the department’s 57,000 mortgagors are house owners, and not farmers, but the workers* dwellings section alone has fifteen millions sterling out on mortgage, while many of the settlers’ branch advances are in respect to urban and suburban houses, in common with other lending institutions, the department found th 6 arrears piling up, and no doubt developed a shrewd suspicion that the most pressing creditors got a share of clients’ diminished income, with tho result that when the six-month period came round there was nothing left for the State Advances Office. So last September the experiment was made in Auckland of calling on clients in arrear, and doing so in accordance with their capacity to pay, a fortnightly wage payment being accompanied by a fortnightly visit from a representative of the department. Tho system was next extended to Christchurch, then to Wellington, and is conducted by the officers of the department where it has its own staff. In other places selected land agents make the collections. Inquiries at the head office produced the opinion that the system has thoroughly justified itself, and that it is not strictly confined to clients in arrear. Many others have asked for facilities to pay a little at a time on their interest and principal, and they are afforded the same service.