A local CD stall

Community Finance

Barriers to banking and financial services stifle enterprise and perpetuate poverty. Community finance can help those who have been excluded by mainstream banks.

Disadvantaged communities have been repeatedly let down by high-street banks and mainstream financial institutions. Basic bank accounts and small loans are seen as unprofitable, and have been marginalised. Branches in poor areas have been closed, allowing predatory doorstop lenders to move in. People who are in most need of affordable credit have become the least able to access it. When mainstream finance has failed, nef believes that policymakers need to strengthen and support the community finance sector, which is already playing a vital role in revitalising some of the UK's most neglected neighbourhoods.

nef's work on community finance involves research into Community Development Finance Institutions (CDFIs), Credit Unions, Community Development Venture Capital (CDVC) and Social Enterprise Finance Funds.

Key facts

  1. 1
    3 million people in the UK do not have a bank account1. 1.75 million people in the UK do not have a bank current account, and 9 million lack access to affordable credit
  2. 2
    The UK doorstep lending industry - charging interest rates as high as 1000% APR - is worth £35 bn annually
  3. 3
    There are around 80 community development finance institutions in the UK, who have financed 15,000 businesses and sustained or created 33,000 jobs.

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