Interest-free loans: You can receive up to £100 to spend on groceries, here's how

From security tagging dairy products to political debates surrounding tax cuts, signs of the cost-of-living crisis in the UK are everywhere.

Next up? Interest-free loans to help those most affected by inflation.

The scheme

Iceland supermarkets and charity lender Fair for You have teamed up to offer loans ranging from £25 to £100 to struggling households. The loan is intended to offer a helping hand to those feeling the pinch the most to buy everyday items during school holidays – when the children are home for additional meals – and during the time between pay days.

The way it works is using preloaded cards that can be applied for online. They can be used in-store or online by successful applicants, up to their £100 limit. Still a bit short? Join the Iceland Food Club and top up with £25-£75.

Having helped over 5,000 eligible customers during a trial-run, the loan scheme is now being implemented at full-force across the UK. Although the pilot program included small interest rates on the micro-loans, Iceland has decided to invest an additional sum in order to remove them entirely – much to the benefit of customers in need.

Now, the only expectation is £10 per week in repayment.

Its reach

Although there is no concrete estimate of how many households will feel relief through this initiative, it is expected to ease cost constraints felt by thousands of families across the UK.

According to an independent evaluation cited in The Guardian, participants in the pilot program resorted less to food banks and were more likely to be able to afford other expenses such as rent, bills, and council tax.

Managing director of Iceland, Richard Walker, stated the following, as per The Sun:

Fresh thinking is required by business and government to find solutions.

Fresh indeed! With the help of the frozen food retailer and Fair for You, we can hope that more Brits are able to get back on their feet.

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