Written answers

Wednesday, 4 May 2016

Department of Social Protection

Credit Union Lending

Photo of Tommy BroughanTommy Broughan (Dublin Bay North, Independent)
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8. To ask the Minister for Social Protection the status of her collaboration with the Irish League of Credit Unions on providing small loans to persons on lower incomes; and if she will make a statement on the matter. [8861/16]

Photo of Joan BurtonJoan Burton (Dublin West, Labour)
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A Personal Micro Credit Scheme has been developed under the auspices of the Citizens Information Board and the Social Finance Foundation and supported by the Department of Social Protection. The Scheme, which is currently being piloted, provides for small scale loans by Credit Unions to borrowers who have difficulty accessing low cost credit. The loans under the scheme range from €100 to a maximum of €2,000.

The focus of the pilot scheme is social welfare recipients who avail of Personal Micro Credit loans from their Credit Union and are facilitated, with their consent, in the repayment of such loans through the Household Budgeting facility, operated by An Post. The deductions from their weekly social welfare payments are then transmitted on to the relevant Credit Union.

The pilot scheme is live in 30 Credit Unions, 28 of which have written loans. Almost 1,200 loans have been drawn down to date. The average value of loans drawn down is €500. From information gathered to date, sixty eight percent (68%) of loans are for amounts of €500 or less, twenty eight percent (28%) are in the €500 to €1,500 range, with the balance of four percent (4%) in the upper €1,500 to €2,000 range. The pilot is expected to be completed by the end of May 2016. The findings of an evaluation report to be completed on the pilot scheme will help to inform the final scheme model to be rolled out nationwide, if the pilot is successful.

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