New scheme will allow people borrow low-interest loans from credit unions

It is hoped it will keep people away from money lenders

Credit union, loans, Personal Micro Credit Scheme, Social Protection, Brendan Whelan

The Donnycarney Beaumont and District Credit Union off the Malahide Road in Dublin | Image: RollingNews.ie

A pilot scheme designed to keep people out of the hands of money lenders is set to go nationwide.

The Personal Micro Credit Scheme allows people on social welfare to take out small loans from their credit union.

It has been piloted in 30 credit unions, and the Department of Social Protection says it has proved very successful.

The pilot scheme was launched last year following publication of a joint Social Finance Foundation (SFF)/Central Bank report on such schemes in other countries in April 2015.

Loans averaging less than €500 were provided to almost 1,300 social welfare applicants.

It is planned to roll out the scheme across the credit union network during 2016 and 2017.

The scheme had a 95% satisfaction rating among customers.

Brendan Whelan of the Social Finance Foundation explains why.