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<p>The Government recognises the vital role of credit unions in the financial wellbeing
of their communities, providing an ethical home for their members’ savings and affordable
loans to those who may otherwise have to resort to high-cost lenders.</p><p> </p><p>Local
authorities have significant freedoms to choose what investments they make and how
to finance them. The Government funded £617m for the Local Authority Discretionary
Grants Fund, as well as further funding for the Small Business Grant Fund. Both funds
closed in August 2020. The Government has also provided £2 billion of discretionary
grant funding for local authorities in England through the Additional Restrictions
Grant, to support businesses in the local area, which credit unions may have benefited
from. Local authorities determine how much funding to provide to businesses and exactly
which businesses to target.</p><p> </p><p> </p><p>Separately, the Government has provided
significant support for credit unions. In total, £96 million of dormant asset funding
has been released to Fair4All Finance, the independent body set up by Government to
distribute dormant assets funding to support financial inclusion. Fair4All Finance
has so far provided over £15m in financial support to the community finance sector,
including credit unions, as part of their COVID-19 response. This includes £12m of
equity investments in community finance providers and £3.6m in COVID-19 grants, including
funding from their £5m COVID resilience fund. It also includes an expanded Affordable
Credit Scale-up Programme, which aims to improve the access and availability of affordable
credit, and which I expect to be of benefit to credit unions.</p>
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