Poor borrowers can finally see sunny days ahead! They will now not have to resort to expensive lenders for credit or be exploited at the hands of loan sharks.
Usually kept at a distance from reasonable loan deals and low-rate credit cards, the poor have now some help at hand with the launch of an East London-based business, Fair Finance that will offer loans till £2,000 and provide basic bank accounts.
Formed in association with community organisations, housing associations and the banking community, Fair Finance will provide these loans at a fixed interest rate of 21%. In fact, poor borrowers shell out a whopping £500m per year as interest charges, according to the managing director of Fair Finance, Faisel Rahman. With the standard normal market shutting its doors on the poor, borrowers are generally found to pay lofty interest rates of 150% and above.
Fair Finance, on the other hand, will give loans on the basis of the borrower’s individual condition. With some proof of their repayment ability along with the support of two referees, the poor can get loans from the company at 21%. Rehman said ‘We will look at their ability to repay now, rather than their financial history.’
For the time being, Fair Finance has planned to provide loan facilities to select regions of Tower Hamlets, Hackney and Newham who are mainly deprived of proper banking opportunities. It certainly plans to extend its services across the nation later. It has also received support and financial aid from Natwest, The Royal Bank of Scotland and Barclays.
Posted
on : Thu, 07 Apr 2005 00:00 GMT | Loans News
By : Salim Patel
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