In recent years, an alarming number of New Zealand homeowners have fallen victim to unscrupulous contractors, resulting in significant financial losses. The Ministry of Business, Innovation & Employment reported that nearly $200 million was lost to scams over the past year, highlighting the urgent need for better consumer protection.
Homeowners Left in the Lurch
Home renovation projects are particularly susceptible to disputes and financial losses. The majority of homeowners however have no guarantees in please. Consumer NZ notes that in the minority of transactions where trade organisations offer guarantees covering loss of deposit, defects, and non-completion, these guarantees often come with limitations and exclusions, leaving homeowners vulnerable.
The Need for Secure Payment Solutions
Given the increasing risks, it’s imperative for homeowners to seek secure payment methods when hiring contractors. Traditional deposits, often paid upfront, can leave consumers exposed if the contractor fails to deliver as promised. These deposits can be anywhere from 30-50% of the total cost of the project. While deposits are standard, the timing and security of these payments are crucial. Fair Go, the well known NZ consumer rights organisation, advocates for holding deposits in trust to ensure funds are used appropriately and remain protected. Or in simple terms, a good job deserves a safe deposit.
Introducing IPromise: Your Deposit Guardian
In response to these challenges, an innovative app called IPromise has emerged, aiming to revolutionize the way homeowners and contractors handle payments. IPromise acts as a secure intermediary, holding deposits in escrow until project milestones are met or the job is satisfactorily completed. This approach ensures that contractors are paid promptly for their work, while homeowners can rest assured that their funds are protected against potential fraud or non-performance.
How IPromise Works to Protect Your Deposit
- Agreement Setup: Homeowners and contractors agree on project terms, including payment schedules and milestones.The NZCB outline some of the different terms here.
- Secure Deposit: The homeowner deposits the agreed amount into the IPromise BNZ escrow Trust account.
- Work Commencement: The contractor begins work, knowing funds are securely held.
- Milestone Verification: Upon reaching agreed milestones, funds are released to the contractor.
- Project Completion: Once the project is completed to the homeowner’s satisfaction, the remaining funds are released.
Benefits of Using IPromise
- Financial Security: Deposits are protected, reducing the risk of financial loss.
- Trust Building: Both parties have assurance that funds are handled transparently.
- Dispute Reduction: Clear terms and controlled payments minimize potential conflicts.
Conclusion – Next time you search ‘Builders near me’
As contractor-related fraud continues to pose significant risks, homeowners must adopt proactive measures to safeguard their investments. So next time you are searching ‘Builders near me’ utilizing secure payment platforms like IPromise offers a modern solution to an age-old problem, ensuring that both homeowners and contractors can engage in projects with confidence and peace of mind. After all “If you wouldn’t hand them cash, don’t deposit unprotected.”
