Housing Trust London & Quadrant is to set up a community bank with initial funding from lenders Barclays and Lloyds TSB.
The bank, provisionally named London First, will tackle the financial exclusion faced by thousands of tenants across the capital who are without bank accounts or access to cheap finance.

The move mirrors the government's agenda to reduce the number of people suffering from financial exclusion and could help pave the way for the equity stake model of asset accounts (Housing Today, 13 June, page 9).

David Montague, finance director for London & Quadrant, said: "I think this is the next stage for the sector, moving from social landlord to social business."

The community bank will begin three pilot projects in the next 12 months. Two will be in the London boroughs of Greenwich and Lambeth, the other, in partnership with Metropolitan Housing Trust, in Enfield.

If the pilots are successful, London & Quadrant foresees copycat services being rolled out across the country by partnerships involving housing associations, local authorities and lending institutions.

Montague estimates the scheme will need to have amassed a "£5m loan-book within three years of the full-scale launch" to be financially feasible.

Source

Housing Today