Nesta offers £1.35m prize fund for fintechs that can to help borrowers avoid sharks and get easier access to affordable loans
Community lenders such as credit unions are being urged to work more closely with financial technology specialists – known as fintechs – to give would-be borrowers easier access to affordable loans.
The call was made last week by John Glen, Economic Secretary to the Treasury, at the launch of the Nesta Affordable Credit Challenge.
The competition is open to more than 400 community lenders and fintechs which can pair up and bid for prize money totalling £1.35 million.
This is just the latest in a series of challenges issued by Nesta, a charitable organisation that encourages the development of ‘bold ideas’ for the public good.
The ultimate aim is to give borrowers more choice so they can avoid payday lenders which often charge sky-high interest rates.
Applications open at the end of the month for grants of between £125,000 and £150,000 for up to six partnerships to develop ideas. Three winners will receive an extra £200,000 each next spring.
More details are available at affordablecreditchallenge.com.