Dáil Éireann debate -
Wednesday, 11 Dec 1991

Vol. 414 No. 5

Written Answers. - Loan Guarantee Fund.

Ivor Callely

Question:

77 Mr. Callely asked the Minister for Social Welfare the progress which has been made in assisting people in need of money to avoid having to use the services of moneylenders, since the setting up of the loan guarantee fund run by St. Vincent de Paul; the criteria which are required to avail of this fund; the amount of money which has been utilised in 1991; and if he will make a statement on the matter.

Minister for Social Welfare (Mr. Daly)

Since the introduction of the loan guarantee fund, over 320 families have been introduced to credit union membership by the Society of St. Vincent de Paul and loans, which are guaranteed by the fund, have been arranged on their behalf. In addition, the society have assisted some 500 people with financial problems through their debt advisory clinics.

The principal objective of the fund is to break the borrowers's reliance on expensive credit sources such as moneylenders. This is done by assisting the client to develop a budget which takes account of his or her commitments while at the same time providing access to cheaper credit sources via the loan guarantee fund. Participation in the scheme is open to those who are prepared to accept this budget based approach to their financial difficulties. However, each case is decided by the society on its own merits.

The amount of money utilised in 1991 is not yet available. However, the overall fund is now in excess of £225,000 all of which has been lodged with credit unions in surety accounts for the purposes of guaranteeing loans. The amount in excess of £200,000 arises from interest payments on the original fund of £200,000.

My Department are at present conducting a review of the operation of the loan guarantee fund which will be completed shortly.