Personal Micro Credit Scheme Goes Nationwide
Social Protection Minister Leo Varadkar has confirmed that a scheme designed to offer low-cost loans to low-income families is now being made available to credit unions right across Ireland.
The It Makes Sense loan has been available in 30 credit unions since last November on a pilot basis. It’s designed to make short-term credit available on a low-cost basis to the people who need it most, and is designed specifically as an alternative to high-cost money-lenders.
To-date more than 1,200 loans have been drawn down with an overall value of over €720,000. The average individual loan is €500. The pilot stage showed that more than half of those using the scheme had previously used a money-lender, and that 22% of those on the scheme were thinking about using a money-lender before they signed up.
The scheme is now moving to a permanent footing and being offered to credit unions nationally. A further 50 credit unions have already expressed interest and 18 are in the process of signing up.
Speaking at the launch event at Meath Street Credit Union, which took part in the pilot scheme, Minister Varadkar said:
This small loans scheme represents real practical help for families and individuals struggling on low incomes. Many of the participants may struggle to get credit elsewhere, and may not have a bank account or savings. So when the unexpected bill arrives for home or car repairs, a new fridge or a family occasion, some turn to money lenders and loan sharks. This new scheme will ensure access to small loans at reasonable interest from the credit union, with the option of repaying the money through my Department’s Household Budgeting Service.
Read the full press release here.