Credit unions across Scotland are benefiting from two Scottish government funds to help them support vulnerable families through the financial consequences of coronavirus.
The Third Sector Resilience Fund and the dedicated Credit Union Resilience Loan Fund will provide grants and loans totalling more than £20 million, available to be shared by more than 100 credit unions across the country.
Robert Kelly, chief executive of sector body the Association of British Credit Unions (Abcul), said: “There’s no doubt that there’s a lot of pressure on credit unions all over the United Kingdom at the moment. In all cases the effect of the current situation is being experienced by some of the most vulnerable in our society – and in lot of cases it is these individuals who rely on their credit union for affordable loans.
“Abcul has been working closely with the UK government and the Scottish and Welsh governments to deliver effective support to those credit unions who need it most.”
At the start of the Covid-19 outbreak the UK government signalled a willingness to support the credit union sector and aid its expansion through a programme of legislative reform in the coming months.
Abcul says this reform agenda will be critical in ensuring the credit union sector becomes more relevant across society with transformation and innovation across our range of products and services.
“Abcul has hosted online conference sessions with credit unions from all over Britain to identify issues of emerging concern and ensure these are addressed and the business strengthened to deliver essential financial support to members and to staff,” added Mr Kelly.
“There have been tremendous examples of partnership working. The voices of our credit union leaders are being channelled to government in a robust and effective way and the response has been hugely encouraging thus far.”
The Third Sector Resilience Fund (TSRF) is a £20m emergency fund for charities, community groups, social enterprises and voluntary organisations working in Scotland. It supports organisations that already deliver services and products but find themselves in financial difficulties directly as a result of the pandemic. The primary intention is to help third sector organisations to stabilise and manage cash flows over this difficult period.
TSRF is delivered by Firstport, Social Investment Scotland and the Corra Foundation and provides grants up to £100,000. In addition there is up to a further £5m available in fully flexible, 0% interest loans starting at £50,000. The fund will be complemented by specialist business advice from Just Enterprise to help grant recipients maximise the impact of the financial support.
To be eligible, interested organisations must be:
- a charity, social enterprise or voluntary organisation based in Scotland and/or primarily delivering services/activities in Scottish communities;
- already delivering those products or services prior to March 2020;
- and needing funding to stabilise cashflows directly as a result of the impact of COVID-19, as opposed to pre-existing financial difficulties.
Applications have already closed for the Credit Union Resilience Loan Fund, also managed by Social Investment Scotland, with allocations to be announced.