BNZ errors put customers out $3.8m

Bank of New Zealand will refund $3.8 million to more than 10,000 customers because of problems with its loan documents.

The bank said errors were made in the wake of changes to the Credit Contracts and Consumer Finance Act (CCCFA), and some BNZ customers would get a refund of some of the interest and fees they had paid.

It said more than 10,000 customers had been identified who had not received their documentation quickly enough, or whose documents had missing or incorrect information.

Affected customers will have their refund automatically deposited into their account or will have a cheque posted to them in the next few days.

Under the CCCFA, if correct disclosure is not given to borrowers, or the information is incomplete or inaccurate, the credit contract cannot be enforced.

BNZ made some errors when it implemented the new requirements in 2015. Some confirmation letters weren’t sent out quickly enough when customers made alterations to their accounts.

Some documentation was missing information, while some new credit card or home loan accounts were set up with old documentation because the rules changed before they were finished processing.

The amount customers would get would vary because of the different situations involved, the bank said. The average refund would be about $375, with the smallest amounts owed as low as $0.01. Any refund of $4.99 or lower would be rounded up to $5.

BNZ chief executive Angie Mentis apologised yesterday.

‘‘No customers were overcharged, but we didn’t get it 100 per cent right,’’ she said.

‘‘While mistakes do happen from time to time, finding those mistakes and fixing them is simply the right thing to do for our customers. BNZ is refunding these customers the interest and fees paid during the time they didn’t have the documentation.

‘‘The issues affected less than 1 per cent of BNZ customers and most were discovered and fixed with one month of them occurring. All customers now have the documentation they need.

‘‘A letter confirming their refund will be sent to affected customers this week.

‘‘Those with a BNZ account will have the refund deposited from today; otherwise a cheque will be included with their letter.’’