January 2025 saw a mixed picture for the economy. While sectors like retail and food & beverage remain stable, others, like construction, are facing significant challenges. New dwelling consents have dropped 37% from post-pandemic highs, echoing the struggles seen during the Global Financial Crisis. Overall, financial distress is rising, total debt is up 3.0%, and overdue payments are increasing, particularly in construction, concrete, and manufacturing.
Arrears are climbing as well. 60-day arrears have risen by 95bps month-on-month, and 90-day arrears are up 36bps compared to last year. While Christchurch shows signs of recovery, Wellington remains under pressure. Winding-up applications are up 37.6% year-on-year (credit to the continued drive by the IRD), signalling greater financial strain.
To respond, many businesses are tightening credit terms, especially in retail and flooring. However, some sectors, like plumbing and electrical are still extending credit despite the rising arrears. With cash flow pressures continuing, it’s more important than ever for businesses to actively monitor credit risk and manage financial exposure.
Read the full report for a deeper look at the current economic environment. CreditWorks offers real-time data, tools, and reports to help businesses manage risk and better understand their customers’ credit profiles.
CreditWorks Group provides extensive, real-time credit data and historical insights, helping businesses understand the deeper credit risks and payment behaviours of their customers. Our secure and comprehensive services ensure that companies can make informed decisions based on a complete picture. Discuss with us today how we can help you with comprehensive credit reporting and monitoring of your customers.
Please note that due to the vast amount of data required to produce these reports, most of which is accessed from a multitude of external sources, there is an inevitable time delay in their generation. However we prefer to defer their publication in favour of ensuring greater accuracy.