He said things like fuel costs, groceries, rates and insurance premiums “don’t have a lot of wiggle room” for people.

“All the things that people just have to pay [for], if they’re going to get by, have risen a lot.”

Jurkovich said it was “worrying” people had to take on debt for groceries or petrol.

“I think a lot of people are in a situation where that might be not a great option but their only option.”

He said the more places that BNPL is available, the more it becomes an option for people to use.

“If you get into a position where you’re not able to meet the hooks and hurdles… you can get yourself into trouble and it can be a bit of an invisible debt.

“Quite quickly that becomes a problem.”

Tom Hartmann, personal finance lead at Sorted, said while BNPL makes sense for some purchases, it can spiral out of control with everyday essentials.

“[When] people are using it for like petrol or food, what ends up happening is that it’s not paid off and you need more petrol or you need more food,” he said.

“We’re really seeing a lot of difficulty coming up, it’s obviously why people would be reaching for BNPL.”

Hartmann said they’ve seen examples of people’s entire paycheque going on BNPL services to repay items they’ve bought.

“People don’t realise that they’re borrowing, they just think this is a different way to pay for things.”

Those under 30 were more likely to take on some form of debt to cover living cost increases (61%), compared with Kiwis aged 30-44 (55%), 45-59 (35%) and 60+ (15%), the research found.

$500 million lost in savings

The Kiwibank report also found just over half of New Zealanders (54%) are aware of bonus savings account conditions, leaving many missing out on extra money.

Bonus savings accounts usually promote interest rates made up of a low base rate (often 0.05%) plus a conditional “bonus” rate around incentives such as making no withdrawals for a month or depositing a certain amount each month.

Jurkovich said he was “staggered” by the number of Kiwis with a savings account who don’t understand how the terms and conditions work.

“… and why they don’t get the benefit that they thought they were going to get,” he said.

“We think its half a billion dollars a year that New Zealanders miss out because life happens and they have to access that money.”

But Jurkovich says this shouldn’t be the case.

“The product should be way easier and way simpler to be realising that from time to time while people are saving, they have to dip into their savings.

“And they should still be getting the rate on the money that’s in there, rather than losing out because life happened to them.”

Kiwibank chief executive Steve Jurkovich.

Savings challenges

According to the report, saving remains challenging for many Kiwis.

But some groups face greater pressure than others; Māori, Pasifika, renters and women are more likely to say they struggle to save.

Of those experiencing saving challenges (61%), 74% cited cost of living as their biggest barrier to saving – up from 69% last year.

Almost a third (28%) of people said they didn’t have enough in their account to cover an unexpected $500 bill without borrowing, selling something or putting it on a credit card.

That was little changed from last year (29%).

Sorted’s Hartmann said having emergency savings was the foundation of being financially stable.

“It’s not just about having a static emergency fund but actually each time you have to use it that you’re building back stronger,” he said.

“The antidote to a lot of the difficulties that people are getting themselves into with BNPL services is an emergency fund.”

But despite cost-of-living challenges, budgeting and saving habits were holding steady over the three years of the survey, according to Kiwibank’s report.

Those who said they regularly saved money increased from 41% in 2024 to 44% in 2026.

Meanwhile, 59% of people said they had a defined monthly budget in place.

More than a third (39%) had also made deliberate changes to improve savings, such as reducing discretionary spending (28%), changing grocery shopping habits (14%) and cancelling subscriptions (10%).

“Three years of research shows that despite ongoing financial pressures, Kiwis continue to budget, save and find ways to make progress, from cutting spending to trying new tools,” Jurkovich said.

Cameron Smith is an Auckland-based business reporter. He joined the Herald in 2015 and has covered business and sports. He reports on topics such as retail, small business, the workplace and macroeconomics.