Simplicity forms ‘rebel alliance of finance’ with First Credit

Non-profit, low-fees KiwiSaver provider Simplicity is looking to stir the finance sector with a new alliance with credit union First Credit.

The two outfits will introduce their customer base to the other organisation, online and physically, but there is no financial or product link, other than referral to each other’s products and services.

Simplicity head Sam Stubbs said it would be the start of a self-styled “rebel alliance of finance” to compete with big banks.

“We are taking this important first step in getting social enterprises and non-profits to work closer together, reach out to each other’s members, and highlight that there are real alternatives to the big banks.”

No money would be changing hands, and no product distribution or financial advice provided, he said.

“We’ll start introducing each other’s products to respective clients and we start a long journey of trying to provide a cheaper and better alternative to the banks for a whole lot of financial products that are too expensive for ordinary Kiwis.

“For First Credit that’s in deposit and lending which is their area of speciality and ourselves which is KiwiSaver and funds management.”

First Credit chief executive Simon Scott said credit unions and other non-profit financial groups were not insignificant, but an alliance such as this would help speed growth.

“There is huge long-term potential in like-minded organisations working together more closely to serve their combined base of loyal and engaged members.”

First Credit is a 68-year-old financial co-operative, with more than 60,000 members and 14 branches from Whangārei to Invercargill, offering personal loans, mortgages, everyday accounts and term deposits.

Simplicity is a default KiwiSaver manager, with more than $5.2 billion of funds under management and 143,000 members. It is also engaged in social housing, private equity, and venture capital sectors.