Well another one bites the dust. As written about here and here, finance company Bridgecorp has been placed into receivership.

Shocking timing seeing it happened the same week that Kiwisaver was launched.

There are now 18000 predominately Ma and Pa investors who don’t know how much of their intial capital they’ll be getting back, let alone any potential return on their investment.

Unfortunately these same Ma and Pa investors are precisely who Dr Cullen wants to see buy into Kiwisaver. If I were those Ma and Pa’s I’d be asking question like;

  • Is Kiwisaver Government guaranteed (answer – no)
  • What sort of investments will companies be making with the Kiwisave funds (answer various – from stocks at the high risk end to cash at the low risk end)
  • Who is to say it won’t all go pear shaped (answer – well no one, them’s the risks with investment)

Interesting to see that Bridgecorp would have been considered only a moderate risk investment, lending as it did to real estate developers.

All this in my humble opinion (and the panic that Ma and Pa investors seem to always display at times like this) calls into play the level of financial acumen our population has. I content quite low – sites such as the excellent Sorted one go some way to help but more need to be done to increase the financial literacy of our society.

Meanwhile I’m glad I didn’t have a cent with Bridgecorp!

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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