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Published byLionel Norton Modified over 9 years ago
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Tess Pendle Head of My Home Finance
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Why? Response to members concerns Needs of vulnerable tenants
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The Credit Gap Doorstep/Illegal Credit Unions Banks
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Debt spirals Rent arrears Health/social issues Member concerns
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Federation Response Solvent & sustainable social business Small sum (“micro”) lending Long-term financial plan
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Not for Profit “a social business...You are committed to solving a social problem with no intention of making personal financial gains. You cover all costs through your operations so that your business is self-sustaining” Muhammad Yunus, May 2010 Grameen Bank founder & Nobel Peace Prize Winner, 2006
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Partners HAs DWP GF Wates Giving RBS ELM
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Governance Independent CLG Federation Founder Member Board and Sounding Board
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Launch
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Pilot Wolverhampton Tamworth Walsall Erdington Dudley Birmingham City Worcester Northfield HerefordCoventry 38 Jobs
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Credit Basic bank accounts Savings accounts Money advice Services
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Banks + Credit Union CDFIs/MHF Home Credit (IML) Loan Shark The cost of credit today £6 to £13 per £100 £30 per £100 £75 - £100 per £100 £100 + per £100 Good credit history Share based & can’t take high risk percentage All high risk but no further subsidy required High risk, face to face, flexible, personal Female, 30-40 yo, welfare benefit, social housing
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Customer Relations Building Credit Scoring Flexibility in Payments Personal Contact Early repayment no penalties Arrears collection
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Process Initial contact Appointment Interview Decision Payment (Money advice)
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Roll Out
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Roll out North East/West Alternative delivery models Closer HA and stakeholder involvement
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So far… Loans:4,007 Average loan £366 Aggregate lending £1.2 million
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Savings Accounts 46%
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Demographics gender
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Demographics - age
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Demographics - ethnicity
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Analysis/Impact Typical MHF customer: Borrows around £366 Currently repays £417 Better off by £249/year (against HC)
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Analysis/Impact Based on average loan £366 if borrowing taken out at £82/£100: Total annual savings for clients roughly £996,000
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Thank you tess.pendle@housing.org.uk
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