The Government has proposed measures to stop loan sharks targeting the most vulnerable members of society.
It is proposing caps on interest rates, licensing of lenders and greater penalties for irresponsible lending, in a move to protect consumers from predatory lending.
The Government released its findings from a review of the Credit Contracts and Consumer Finance Act on Wednesday.
Consumer Affairs Minister Kris Faafoi says unaffordable loans lashed with huge penalties and fees "trap people and whanau in an appalling spiral of debt that is very difficult to get out of".
The report says 12 percent of New Zealand households report not having the money to meet everyday needs. One in four households say they only just have enough money.