Just down from Dalston Kingsland station, in between construction sites and abandoned car-washes, are the modest-looking offices of Fair Finance.
The micro-finance company has granted 583 loans in Hackney with a total value of almost £500,000 since it opened in 2005. Around 70 per cent of these loans were granted to women; all the loans went to people who cannot find fairly-priced credit elsewhere.
It is not a charity – some loans are repaid with 35 per cent interest. But for founder Faisel Rahman, the goal is to “tackle usurious and unfair lenders” who charge up to 2,000 per cent.
The UK is incredibly relaxed about the lenders Rahman describes. It is one of a handful of European countries that has no legal cap on the amount of interest lenders can charge. Even parts of America, the birthplace of payday loans and easy credit, have moved to curb profiteering from struggling borrowers.
Rahman started the company after his experiences with a successful micro-loan company in Bangladesh. Thanks to Fair Finance loans, scores of companies in Hackney have got off the ground, and hundreds of individuals have not gone through the financial floor.
Hackney Community Transport now employs over 300 people, but haven’t forgotten their micro-finance lenders. “We would never have been able to grow the way we did without a micro-loan. Now we a more established company we can access other loans, but it was an essential first step,” said Stephen Mason, the group’s finance director.
The company publishes loan figures by geography and amount, to prove “everyone has an equal chance of access”. The Fair Finance website features plaudits from Barclays Bank for this transparency and sense of fairness.
But perhaps the most worthwhile step Rahman has taken was to publicise the deep-seated money issues in Hackney, through his semi-regular Guardian column, a recent feature in the Observer and as part of the Better Banking campaign.
Quietly saving Hackney locals from financial ruin is clearly an honourable and much-needed activity, but Rahman’s relentless noise in the national press on the subject suggests action is needed on a much bigger scale.
While banks like Barclays commend Rahman’s efforts, their indignation at any attempt by the government to tighten the rules on loans leaves the door open for the “usurious and unfair lenders” Fair Finance hopes to stop.
