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Credit Unions urged to sign up for micro-loan scheme aimed at steering people away from moneylenders

The government is scrapping an attached charge to try entice more credit unions to offer the loans.

Image: Sam Boal/Rollingnews.ie

MORE CREDIT UNIONS are being urged to sign up to offer a micro-loan scheme aimed at people who may have difficulty securing credit elsewhere and steering them away from high-cost moneylenders.

It comes as the government scraps a 25 cent charge attached per transaction for credit unions offering the “It Makes Sense” loans.

The scheme provides small-scale loans from €100 to €2,000, and is available to those in receipt of social welfare.

People pay back the loans through the household budget facility offered by An Post. There are currently 7,000 loan repayments being facilitated in this manner.

Currently, 109 credit unions are participating in the loan scheme.

Irish League of Credit Unions President Gerry Thompson said the scheme is one which his organisation backed from the outset.

“[We've] sought the removal of the transaction charge which has been a barrier to more Credit Unions getting involved,” he said today. 

The removal of the 25 cent transaction charge will ease the burden on our 109 Credit Unions that are already providing the ‘It Makes Sense’ loan to those in society who need it the most.

Thompson added that he hopes more credit unions will sign up for the scheme on the back of the removal of this charge. 

“We are committed to continuing to encourage more people to turn away from moneylenders,” he said. 

Minister for Employment Affairs and Social Protection Regina Doherty said that the cost of these transactions will now be met by her department directly. 

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Sean Murray

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