Marac to offer non-guaranteed term deposit

After The Treasury tinkered with the scheme last month to allow deposit takers to offer both guaranteed and non-guaranteed deposits, Marac announced it will offer non-guaranteed term deposits in its outlook newsletter for the New Year.

Retail investment manager Andrew Ford said the company had "lobbied hard" for the change, as it would prefer to pay its investors a higher interest rate rather than give the money to the government for a guarantee, though it will provide a guaranteed option as well.

With finance companies paying about a 1% premium in fees for the guarantee, investors in non-guaranteed deposits could "potentially" see this passed on to them, he said.

"We would like to pay our investors higher returns than pay the government in a guarantee fee," Ford told depositrates.co.nz. "It's also about the transition from people investing solely in deposits under guarantee - we want people to invest in Marac."