Fair for You LogoA new CfRC report highlights the huge social benefits that could be achieved if Government were to widen the access to affordable, not for profit, alternatives to high cost credit.

The report is based on research involving more than 1,000 low income customers of Fair for You – a new national, not for profit alternative to the high cost rent-to-own stores and door-to-door moneylenders.  It assessed how much money people saved by using Fair for You to fund the purchase of essential items such as cookers, fridges, and household furniture as well as the wider social impacts of moving people away from the high cost lenders.

In its first year of operation, Fair for You has provided around 3,000 customers with loans totalling over £1 million. Assessing the positive impact of Fair for You on customers that would otherwise have had to use high cost credit, we found that:

  • Half of Fair for You’s customers are less anxious, stressed or depressed as a result of using their service;
  • 45 percent have seen an improvement in their physical health, either because the items they have obtained have had a direct impact on this; because they are eating better; or because their physical health has improved alongside their mental health;
  • One third of customers report that their children’s health and well-being has improved. CfRC estimates that Fair for You has had a positive impact on the levels of stress experienced by about 2,500 children over the course of past year.  Around 1,300 children are eating better as a result of FFYE, and about 600 children are sleeping better; and
  • Customers using Fair for You instead of rent to own stores are saving an average of around £500 per item.

Taken together, we estimate that these positive effects save society at least £1500 for every person who has access to affordable credit.  With an estimated 12 million people currently unable to access mainstream credit and either using high cost credit or going without essentials, the overall savings to society to be achieved by scaling up the affordable credit sector could be as high as £18 billion per year.

The report calls on Government to develop a national strategy to scale-up Fair for You and other affordable lenders.  The strategy needs to coordinate investment from national and local Government, utility companies, social landlords and health agencies which would all benefit from more affordable credit being provided to lower income households.

Speaking in the House of Commons at the launch of the report, CfRC Director, Damon Gibbons said:

“Our report demonstrates the huge potential savings that could be made if Government were to get serious about expanding the affordable, not-for-profit, credit sector.  Leaving people in the clutches of high cost lenders is damaging to the health and well-being of millions of households in the UK and gives rise to massive social costs.  A national strategy to address this is urgently needed.  With inflation rising and living standards under threat, Government needs to deliver tangible help to hard up households.”

Chief Executive of Fair for You, Angela Clements said:

“Too many families go without items that most of us take for granted, such as cookers, fridges and even beds. The Office of Civil Society will find it hard to ignore this new evidence of the rapid financial and health improvements reported by our customers within our first year of lending. A Government-led strategy to scale up proven, affordable lending solutions will free up money to circulate within the poorest communities in the UK.”

Download a PDF of the full report