Financial measures to support struggling Australians
Low income earners who have been affected by the global financial crisis will be given help to get back on their feet through a $33 million Australian Government investment.
The funding to provide nation-wide financial support services will include:
- expanding the availability of no-interest loans to buy essential household items like fridges and washing machines.
- extending matched-savings schemes to help more people develop and achieve long-term savings goals.
These services are expected to benefit over 30,000 low-income Australians.
No Interest Loans
Good Shepherd Youth and Family Service will receive $18.5 million to expand its No Interest Loans Scheme (NILS), StepUP and AddsUP programs.
This will enable Good Shepherd’s loans and matched savings programs to be extended to around 25,000 more people in up to 350 locations across Australia.
In partnership with the National Australia Bank, Good Shepherd Youth and Family Service offers no interest loans of between $800 and $2000 for the purchase of essential household items.
In one case, a mother took out a NILS loan to pay for repairs to her car so she could drive her disabled daughter to school and medical appointments.
Matched Savings Schemes
We are also providing $14.5 million to the Brotherhood of St Laurence, in partnership with ANZ, to expand Australia’s largest matched savings scheme, Saver Plus.
This funding will more than double the program’s reach to provide services for an additional 7,600 people in need, in 60 additional communities.
This scheme helps people on low incomes save for education and training purchases, with ANZ matching their savings, dollar-for-dollar, up to $1000.
For example, with the addition of the matched savings to her own savings, a mother was able to buy her children a computer to do their schoolwork. She now regularly saves the same amount every week.
An evaluation of the Saver Plus scheme by RMIT showed that two to three years after completing the scheme, 70 per cent of participants are still saving at the same rate.
Funding to the Brotherhood of St Laurence will also be used to pilot the new Progress Loans program which provides loans to people who would otherwise be excluded from mainstream credit.
These services are all crucial to helping low income households successfully manage their finances and develop financial capability.
Today’s funding announcement supports community organisations to continue to deliver much needed services at a time when their capacity to raise funds has been affected by the global economic downturn.