News archive - 2007

Treasury allocate £38m to increase consumer access to affordable credit

11 December 2007

HM Treasury has published an action plan for financial inclusion covering the period 2008 to 2011. This action plan is backed by £135 million of funding, and £38 million of this money has been allocated to further increase consumer access to affordable credit through credit unions and other third sector lenders.

You can read the HM Treasury press release that gives brief details of how the £135 million will be spent, or read the full financial inclusion action plan (575KB) .

Growth Fund loans break the £20 million mark

16 November 2007

Growth Fund loans reached a new milestone in October 2007 with a total of over £20 million lent since the scheme began.

In October almost 5,000 loans were approved with a total value of approximately £2.5 million. This means that almost 46,500 loans, with a total value in excess of £20 million have been made to financially excluded people.

The average value of loan is £438 with 82% of those loans being made to customers who had not previously joined a credit union or used the services of a community development finance institution. More importantly, of those customers who took out a growth fund loan, 11% have opened a bank account at the same time.

10 July 2007

Growth Fund Reaches New Areas

Coverage of the Growth Fund service has been extended.

Affordable loans are now available to financially excluded people in the following new areas:

• In York City, and in Pendle, Lancashire - with York and Pendle Credit Unions working in partnership with Leeds Credit Union
• In Wakefield and surrounding areas – with White Rose Credit Union working in partnership with Hull and East Yorkshire Credit Union
• In Goole through Hull and East Yorkshire Credit Union
• In Scunthorpe through North Lincolnshire Credit Union
• In Newtown and across Powys – with the Robert Owen Credit Union working in partnership with Llandudno Credit Union, and
• In Wrexham through the new Wrexham Credit Union

And the Growth Fund will reach even more areas from autumn 2007 as the result of a further bidding exercise that is now underway.

Use the search facility to find out if your post code is covered by these new areas.

22 May 2007

Additional £6 million for Growth Fund – Expressions of interest

The Department for Work and Pensions currently contracts with over 80 organisations to deliver the Growth Fund (GF). It is anticipated that there will be approximately £6 million available to expand coverage of the Fund. Bids are invited to cover those parts of the country where there is currently no GF cover. Bids will be considered from any organisations that do not currently deliver GF, and also from existing contractors providing that they bid to cover completely new areas where there is no cover whatsoever. It should be noted that any successful bidder must be ready to provide the service from 1 October 2007. No Contract will be offered to start after this date.

Because of the limited amount of money available the number of Contracts to be awarded will be restricted. Also, in order for Contracts to be cost effective and sustainable we do not intend to award Contracts that will more than double the size of an existing loan book. However, particular arrangements will be made to consider any bid received from a new lending organisation providing that they are ready to deliver the service from 1 October 2007.

Expressions of interest are invited from eligible bidders that are constituted as ‘not for profit’ companies, organisation or institutions that wish to be considered to provide this service.

Eligible organisations are organisations which are regulated by the FSA and/or licensed by the OFT to provide credit services and access to affordable loans, such as Credit Unions, Community Development Financial Institutions and charitable/non-profit making organisations, with an average annual turnover (before tax all activities included) of less that EUR 100 million during the last two financial years.

Contracts will be for the period 1 October 2007 to 30 September 2008 and the planned timetable for award is as follows (although this may be subject to change):

• Deadline for receipt of EOI – 29 June 2007
• Invitation to Tender issued by – 9 July 2007
• Deadline for receipt of proposals – 27 August 2007
• Evaluation of proposals – August – September 2007
• Award of Contract – 1 October 2007

If you wish to express an interest in being invited to tender for inclusion in delivery of the Growth Fund, please complete this questionnaire (53KB) and post or email it to Barbara Elliott at the address below.

A briefing session may be held in Newcastle in mid July. Please indicate on the questionnaire if you are likely to attend.

Note

Bidders should note that if additional funds become available at any future point another tender exercise could ensue. Any organisation bidding in this exercise would not be precluded from bidding in any potential future exercise, and if this happens every effort will be made by the Department to avoid the submission of duplicate information.

Further information can be found on the Growth Fund website which is updated regularly. Or you can contact:

Barbara Elliott
1st Floor, Saxon House
50 – 52 Heaton Road
Newcastle upon Tyne
NE6 1SL

Email: newcastle.thegrowthfund@dwp.gsi.gov.uk

22 May 2007

Additional £6 million for Growth Fund

In a document entitled “Financial inclusion: the way forward”, published in March 2007 the Government made an additional £6 million available to credit unions and Community Development Finance Institutions (CDFIs) through the Growth Fund.

The additional money will be used:

• To support new lenders in parts of the country where supply of third sector affordable loans is insufficient;
• To support the emergence of new banking providers, through financial support for credit unions investing in transactional banking capability; and
• To fund increased investment in the skills of third sector lenders’ staff and volunteers through a capacity-building programme, as announced in the 2006 Pre-Budget Report. A Training Needs Analysis is currently being undertaken to inform this programme.

Discussions are underway to agree the processes for distributing this additional money, and as soon as decisions have been made more information will be published on this website.

10 April 2007

Additional Growth Fund Money

The Growth Fund project will shortly publish information regarding additional funding in due course. In the meantime we will be unable to respond to individual requests for information