Pilot Irish Business Micro Finance Project Started

DUBLIN, Ireland – Until now, Irish credit unions have not offered their members business loans. Most loans are for household items or cars. During the 2005 United Nations Year of Microfinance, the Irish League of Credit Unions (ILCU) thought credit unions needed a way to advance into this area. Most credit unions do not have the staff expertise for small business loans. ILCU, which supports Ireland’s 530 credit unions, has for the last few months explored a partnership with First Step, a not-for-profit organization that provides loans to start-up businesses and to small businesses wishing to expand. The loans are under _25,000 (US$29,825). Since First Step’s founding by Norma Smurfit in 1991, over 1,500 small businesses have had been helped. Over 3,000 jobs have been created from the projects. A pilot program is being designed to test the working relationship between First Step and credit unions. The selection of First Step was logical. It received international recognition, including winning a European competition “Access to Finance” for its best practices within the area of microfinance. They have been accredited by the European Investment Loan Guarantee Scheme (“scheme” is a positive word used in place of “plan” in Irish-English) and have spoken at many conferences throughout Europe. ILCU feels that partnership with First Step would help credit unions expand the services that they could offer to their membership, which in turn would increase their loan portfolios. The expertise of First Step would help credit unions learn to assess business loans. Even if a credit union lacked the resources to provide the loan, ILCU believes a referral to First Step would build member loyalty. -