How should Northern Ireland credit unions respond to rising interest rates and affordability issues?

With rising interest rates, the cost of living crisis and affordability issues, Northern Ireland households are under financial pressure. It’s becoming harder for you to lend to new and existing members and support your community. Overall, accept rates for loans fell by 5% between 2022 and 2023 in line with the fall in credit scores.

On average, loan applicants in Northern Ireland credit unions have seen their mortgage payments rise by 20% over the last two years. One in ten people with poorer credit scores have missed three or more mortgage payments. 1 in 20 applicants have mortgage arrears. This has doubled in the last year.

On the other hand people are adjusting their spending accordingly. The amount of disposable income being used for loan repayments has actually decreased although it remains high.

Nevertheless, credit card use is rising as more people use credit to fund day to day living expenses.

Regulatory priorities

The above changes are taking place at a time when there’s increased regulatory oversight for how credit unions are measuring affordability and treating vulnerable members.

Must have insights

On Tuesday 21st November 2023, NestEgg will be sharing lending data to find out what’s happening to:

  • Spending patterns
  • Disposable income
  • Affordability
  • Mortgage payments and arrears
  • Missed payments and defaults
  • Credit scores
  • Indebtedness
  • And much more…

An improved understanding of changes to lending risk means that Northern Ireland credit unions can adjust their lending strategies to reflect wider changes in the economy.

The event is free and is being held between 10:30 and 12:00 at the Ramada by Wyndham Belfast City Centre, 20 Talbot Street Belfast, BT1 2LD.

Book your place here.

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Adrian Davies

Adrian is a co-founder at NestEgg. He is an alternative finance and credit union expert with extensive experience of start-ups, business development, IT, Target Operating Models and regulatory compliance. Adrian has 20 years’ experience in the responsible lending sector, supporting credit unions with innovative ideas so they can grow and meet member needs.

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