Our UK wide No Interest Loan Scheme (NILS) pilot has received a boost with a new £1.2m commitment from JPMorgan Chase.
The pilot is the first of its scale across the UK. By offering a way to spread essential or emergency costs, NILS loans will provide a vital financial cushion for people unable to access or afford existing forms of credit, but who can afford to repay small sums.
JPMorgan Chase’s investment will allow the pilot to expand to a sixth area of higher deprivation, increasing the number of people in vulnerable circumstances it can support by a further 3,000.
It will also enable a trial to test the benefit of additional financial coaching support for some NILS customers. This programme will help customers keep their payments on track and support them in building their credit file to improve their access to other affordable credit options.
‘Financial stability is a persistent challenge for many people, especially for low-income families, and far too many people don’t have the financial resources on hand to weather an emergency’ said Stephanie Mestrallet, Head of UK Philanthropy at JPMorgan Chase. ‘We’re proud to support Fair4All Finance in their work to help people across the UK build financial resilience.’
Fair4All Finance is teaming up with Toynbee Hall and Fair By Design to deliver the NILS pilot. In 2021 we secured £3.8m in funding from HM Treasury, matched in England by us, and up to £1m of lending capital from each of Wales, Scotland and Northern Ireland.
‘I am proud the Treasury is funding the No Interest Loan Scheme pilot which will provide those who are financially excluded the opportunity to access affordable credit to meet unexpected costs’ said John Glen, Economic Secretary to the Treasury.
‘JPMorgan’s decision to provide philanthropic funding to expand the pilot and provide loan recipients with free, quality financial management advice is very welcome. This is an excellent example of the way the wider industry can support innovative and important initiatives like this, and I encourage other firms to consider doing the same.’
The scheme will work with credit unions, Community Development Finance Institutions (CDFIs) and other regulated not for profit lenders who will help administer the loans across communities. Partnerships with local councils, housing associations, and charities are also key to helping serve more people.
‘We’re delighted to receive this funding from JPMorgan Chase. It will allow us to get more essential NILS loans out to people in real need of support and to test the effectiveness of providing additional financial coaching support, to see whether this can further improve outcomes for NILS customers’ said Sacha Romanovitch OBE, CEO of Fair4All Finance.
‘It’s a great example of how funding from a mainstream provider can be used to help customers in vulnerable circumstances. We think this route is an important step in the journey to seeing banks serve this customer group directly.’