Represents English HAs 1,000 members (99% coverage) 2 million homes for 5m disadvantaged
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Represents English HAs 1,000 members (99% coverage) 2 million homes for 5m disadvantaged. Financial exclusion. No access to mainstream finance No credit history No affordable answer to urgent needs Must borrow from high cost lenders. Consumer borrowing. The Credit Gap. Banks. - PowerPoint PPT Presentation
Transcript of Represents English HAs 1,000 members (99% coverage) 2 million homes for 5m disadvantaged
Represents English HAs
1,000 members (99% coverage)
2 million homes for 5m disadvantaged
Financial exclusion
No access to mainstream finance
No credit history
No affordable answer to urgent needs
Must borrow from high cost lenders
Consumer borrowing
1.2 tn mort-gaged
149bn main-
stream unse-cured
65bn non-standard unsecured
The Credit Gap
Doorstep/payday/illegalCredit
unionsBanks
Debt spirals
Rent arrears
Health/social issues
Member concerns
Federation Response
National, sustainable social business
Small sum lending & allied services
Long-term financial plan
Launch
Launch
Shops
Wolverhampton
Birmingham City
Worcester Northfield
Hereford Coventry
CreditBasic bank accountsSavings accountsMoney advice
Services
Process
Initial contactAppointmentInterviewDecisionDisbursementMoney advice
Banks + Credit union MHF Home/payday
(IML) Loan shark
The annual cost of credit
£6 £13 per £100
£30 per £100
£75 - £100 per £100
£100 + per £100
Good credit historyShare based & can’t take high risk percentage
All high risk but no further subsidy required
High risk, flexible, personal
Female, 30-40yr, welfare benefit, social
housing
Partners
Housing Associations
So far…
Loans: 9,800
Average loan: 340
Aggregate lending: £3.3m
Est. aggregate savings: > £2m
Savings Accounts
46%
Age
39%
26%
25%
10%
30 or under31 - 4041 - 5051 onwards
Household make up
31%
18%
44%
7%
Applicant onlyCouple (with child)Single parentCouple (no child)
Future plans Consolidate WM
Roll out
Refine model
‘One-stop shop’
Future plans Capitalisation
Loan note offer
5 years at 6%
Dual return
