Microfinance Pilot Funding Extended
8 February 2013 at 9:31 am
The Federal Government has committed $448,800 to community development finance in Australia, signing a contract extending its Community Development Financial Institution (CDFI) pilot funding until June 30.
Community Sector Banking has welcomed the move saying the commitment gives the program the funds to continue to assist disadvantaged people excluded from mainstream banking with small loans and financial literacy training.
Community Sector Banking (CSB) is a joint venture between Bendigo and Adelaide Bank and 20 Not for Profit organisations including Jobs Australia, Oxfam Australia, Scope and ACOSS.
"With more than 2.6 million Australians classified as fully or severely financially excluded, there is a compelling argument for affordable financial services that assist people to fully participate in society," CSB Executive Director, Peter Quarmby said.
"Unfortunately there is no quick fix to financial exclusion, but further development of the CDFI sector in Australia has the greatest potential for a lasting solution. Because a real loan from a real banking service helps to rehabilitate their credit rating for the future, not just assist in the short term.
"We found there is great need for accessible microfinance to pay for essential big ticket items, such as fixing the car or the washing machine. But we also found that most people, even those on very low incomes, are diligent about repaying the loan.
"Community Sector Banking has maintained its commitment to its microcredit and financial literacy program In-roads, however this funding injection means we can ramp up and refocus our program, concentrating on those we know need it the most," Quarmby said.
He says that over the coming months Community Sector Banking will be specialising in microfinance for Aboriginal and Torres Strait Islanders in urban and remote areas in the Kimberley and South East Queensland.
“Community Sector Banking sees the continuance of the pilot as an opportunity to keep learning and refining the program," he said.
“We applaud the Federal Fovernment for their vote of confidence in the program and its crucial work and are thrilled to be able to keep assisting people to get their finances back on track."