Kudejah Ali: Personal Loans Manager

SEPTEMBER 2008

Service Cost to client

Money and Debt Advice Free

Microcredit Business Loans 12-19% APR

(£2,000-£10,000)

Personal Loans 28-35%APR

(£200-£2000)

Our Business

Why do we deliver Personal Loans

• People deserve a fair and affordable alternative

• People should have access to a range of services so that they can make informed financial decisions and feel confident about their choices.

• Provide services which aim to improve the well being and financial capability of individuals

Lender Average APR

Provident 183%

Morses Ltd 365%

CLC 1564%

Pay Day lending 1000%

Unlicensed 10000%+

The market rates

How does it work

ENQUIRY

LOAN INTERVIEW

LOAN ANALYSIS

LOAN MEETING

DECISION

LOAN DISBURSAL

MONITORING

END OF LOAN

APPLICATION AND IDENTIFICATION

APPROVED

REJECTED

REASON WHY

ARREARS & DEFAULT MANAGEMENT

Who are our clients

Homemaker

Working FT/PT

Student/otherUnemployed

Retired

Impact 2005 - 2008

•2 Loan officers from 2007

•Interviewed 2500+ clients and given them basic financial support

•Approved 1000 Loans in 3.5 years

•Made over £700,000 in loans

•Saved clients over £500,000 in saved interest payments

•Bad debt rate (181+days) of 5%

•We have helped many of our clients escape the clutches of predatory lenders charging extortionate rates.

FundingRevenue• Current

– Self generated interest payments – 45%– Charities supporting the educational aspect of loan making –

30%– Government Funds – 25%

• Within 3 years– Self generated – 85%– Charities – 15%– Government – 0%

Capital • Current

– Government 50%– Banks 10%– Own recycled funds 40%

• Within 3 years– Government 0%– Banks and Private investors 50%– Own recycled Funds 50%

Challenges

• Small is not always beautiful – we need to grow to make an impact and be sustainable

• Training good staff – low defaults and good loans are down to well trained and motivated staff

• Clarity on the service – not confusing the client or ourselves about what we are doing, and keeping the work simple

• Brand identity – making sure our message and marketing makes sense to clients

• Funding/Investment – securing enough capital to grow our business at affordable rates

• Maintaining the portfolio – keeping defaults low aw we grow

• Product Development – meeting the needs of the clients as they change

• Marrying business and community interests (Hard headed but soft hearted) with partners and staff