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No Interest Loan Scheme to be expanded to 20,000 people

Interest free loan

Many people are struggling with the cost of living crisis (Picture: Getty)

A government scheme offering interest-free loans to those in financial need is set to be expanded to 20,000 people across the UK as the cost of living crisis worsens.

The No Interest Loan Scheme (Nils) has been piloted in Manchester and some other areas and due to its success is being rolled out across the UK.

The aim of the policy is to offer loans of up to £2,000 to people who cannot afford normal loans because of the interest rates involved.

“We fund items from household items and school uniforms to laptops for access to education and training, as well as tools and equipment to help people get back into work,” says Nils on his website.

The scheme will be extended from areas such as Manchester, Worcestershire, Shropshire and Herefordshire to the rest of the country over two years.

After two years, a decision will be made as to whether the program should be expanded further.

Customers are allowed to have a minimum of six months and a maximum of 18 months of credit with the program, with the average being 12 months.

Borrowers can access amounts ranging from £100 to £2,000, with the average amount being around £500.

A protester holds a protest sign that reads'Workers need more £££'

The cost of living crisis deepens (Picture: Getty)

File photo of coins and paper money

The loan scheme aims to help the most vulnerable in society (Image: PA)

£3.8m has been committed to the scheme by the Treasury, £1.2m by JPMorgan Chase and £1m in loan capital from each of the decentralized administrations, matched in England by Fair4All Finance.

Fair4All Finance, which runs part of the programme, was set up three years ago by the Ministry of Finance and the Ministry of Culture, Media and Sport to “support the financial well-being of people in vulnerable situations”.

The Treasury Secretary for Economic Affairs, John Glen, expressed hope last month that a comprehensive program could eventually be introduced.

He told the Association of British Credit Unions that Nils “is a fundamental, worthwhile, new initiative to provide an entry-level product for people who currently exceed the lending capacity of some credit unions”.

“The challenge now is to take this proof-of-concept pilot to a larger pilot so we can validate it now.”

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https://metro.co.uk/2022/06/19/no-interest-loan-scheme-to-be-expanded-for-20000-people-16854383/ No Interest Loan Scheme to be expanded to 20,000 people

Justin Scacco

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