Social landlord lends a hand as credit crunch bites

The Riverside Group has become the first housing association to launch a low cost loans service in a bid to beat loan sharks during the credit crisis.

Moneyline is being piloted in St Helens and if successful it may be rolled out to other areas of the North West and beyond.
The social landlord has secured funding from the Department for Work and Pensions (DWP) to offer affordable loans to people who would otherwise be prey to doorstep lenders.

Laura Bostock, Regeneration Officer for The Riverside Group said: “We will be working to help people manage their finances, as well as offering small low cost loans. People who have a bad credit rating, or who don’t have a bank account are often forced to pay crippling repayment rates for instant loans, which only sends them deeper into financial difficulties. And they can be wary of approaching banks. We want to help build people’s confidence in dealing with their finances.”

Around two million UK households, 10% of the population, do not have access to a bank account. And The Riverside Group’s recent tenants’ status survey revealed that 13% of its tenants are unbanked.

This unbanked group is represented by society’s poorest – low-income families, the unemployed, immigrant and minority groups and the retired – often social housing tenants who can get into arrears by paying off debts instead of their rent.

Laura added: “We’re working in partnership with local credit unions and debt advisors and will be advising people to save. But the reality is that people who don’t save don’t consider the interest rates that they pay for doorstep loans. Rates from some lenders can start at 177% on our housing estates and go far higher. These lenders are often viewed by those that use them as a necessary evil. We are offering a much cheaper alternative as well as signposting people towards help and support to combat financial exclusion.”