Pepper salts up New Zealand market

Pepper officially kicked off its long-awaited arrival in New Zealand with a launch in Auckland on Friday.

A key message the lender had to advisers was that Pepper would be providing a New Zealand solution to local lending issues.

"Our solutions have been designed by New Zealand focus groups," Pepper country manager Aaron Milburn said at the launch.

Milburn, who is a born and bred Kiwi, said 40% of potential borrowers were unaware that there were other lending options if they had been declined by the banks.

He says that is an "unacceptable" figure and Pepper was determined to show New Zealanders there were genuine options to the banks.

Pepper already operates in 11 countries, and its approach is to put in the right management and then build its team in each country.

Milburn says there are lots of opportunities in New Zealand. "In the blink of an eye we will have 100-plus people," he said.

Pepper sees a significant gap in the near-prime space in New Zealand, where families are potentially paying too much or have been in the wrong products due to a lack of choice.

The lender brings to the market the Pepper Product Selector (PPS) tool, which will enable brokers to “get indicative offers for their customers in under two minutes”, as well as a fully-integrated online submission platform for brokers."

Jeff Royle, one of the biggest writers of non-bank loans said: "It was a great launch, one of the best I've seen and speaking to their senior people they have done their homework and see New Zealand as a golden opportunity."

He says Pepper's sweet spots seem to be assisting self-employed applicants; 90% first home buyers with fully gifted deposits; and up to 40-year terms to aid servicing.

"Their online application software is state of the art and cascades different products depending on customer's circumstances. As long as the evidence is provided their five minute offer stands which is great if you are against the clock which a lot of applications are these days.

"Considering banks are up to two weeks on turnarounds 48 hours for full applications is awesome.

"Overall I think they have an offering to broaden the number of people who can qualify, rather than just recycle what can already be done. We've already submitted a few that would not fit Resimac or Bluestone in terms of decent rate and their Near Prime product at 80% for a discharged bankrupt (only 24 hours discharged) at 5.65% is unbeatable."

Pepper Money, on Friday, won Best Non-Bank award at the Australian Mortgage Awards.