| The roll-out of a new microfinance | | | | grants and other financial services to those |
| institution (MFI) could see some of the most | | | | who need it most." |
| financially-excluded people in Britain gain | | | | |
| access to low-rate loans, it has been | | | | Meanwhile, pointing to findings from HM |
| announced. | | | | Treasury, the organisation reported that |
| | | | around one out of 12 British households are |
| Based in London, the Community Money scheme | | | | often unable to access mainstream loans and |
| has been launched to help individuals, | | | | other forms of credit which offer competitive |
| community groups and businesses take out a | | | | rates of interest as they are deemed to be of |
| loan and other financial products. The first | | | | greater risk when it comes to making |
| MFI in the country to be set up as a | | | | repayments. In addition, such consumers were |
| Community Interest Company (CIC), the project | | | | stated to be shut off from the provision of |
| will see two fiscal schemes created to aid | | | | basic financial advice which, if granted to |
| the monetarily-excluded parts of society. | | | | them, could help them to look for low-rate |
| Starting later this month, the Community | | | | loans and make repayments with greater ease. |
| Lottery, a weekly 1 pound sweepstake, has | | | | |
| been launched which will see its proceeds go | | | | Consequently, those Britons on a low income |
| towards a loans and grants fund, which is due | | | | are often forced to rely on unscrupulous |
| to start operating in the early stages of | | | | lenders, who are reported to charge annual |
| 2008. | | | | interest rates of up to 1,500 per cent for |
| | | | short-term borrowing. Such companies are said |
| Meanwhile, the Community Money Financial | | | | to target "the people who least can afford to |
| Inclusion Programme has been developed to | | | | pay such high prices for essential goods and |
| help combat the problem of financial | | | | services". |
| deprivation among low-income consumers. It | | | | |
| will also provide support to those Britons | | | | Earlier this year, R3 - the Association of |
| forced to take out high-interest lending and | | | | Business Recovery Professionals, the trade |
| the associated debt problems in paying back | | | | body representing insolvency practitioners, |
| loans. As a result, the move could see | | | | claimed that recent proposals by the |
| borrowers develop access to more | | | | government could help the |
| competitively-priced loans. In addition, the | | | | financially-excluded avoid unscrupulous |
| programme will see the implementation of | | | | lenders and instead access low-rate loans as |
| financial inclusion strategies on the behalf | | | | they adopt a more responsible approach to |
| of regeneration agencies, local authorities | | | | their finances. Nick O'Reilly, vice-president |
| and housing providers. | | | | for R3, urged those struggling with numerous |
| | | | demands on their money such as secured loans |
| Commenting on the announcement, Puck Markham, | | | | and utility bills to avoid loan sharks and |
| founder and chief executive for Community | | | | instead seek advice from respectable |
| Money CIC, said: "In today's | | | | professionals. Yet those consumers finding |
| economically-polarised society, the more | | | | themselves nearing an untenable money |
| affluent and socially aware individuals are | | | | management position may want to take out a |
| looking to regulated investment opportunities | | | | bad credit loan as a means of getting back on |
| that benefit their local communities. | | | | their financial feet and helping them to |
| Community Money has been set up to provide | | | | repair the damage done to their borrowing |
| that investment vehicle which in turn enables | | | | history. |
| the provision of affordable loans, community | | | | |