Iceland, a British supermarket, has partnered with ethical loans company Fair For You to offer interest-free loans to families struggling over school holiday periods. Known as the Iceland Food Club, the scheme allows customers to get pre-loaded cards with interest-free credit which can be spent in Iceland and Food Warehouse stores.
Customers pay back the loans at a rate of £10 per week, and the scheme allows top-ups up to six times a year, with each top-up available during a school holiday period. The initiative is designed for those who cannot get credit elsewhere and just need extra money to cover the holiday period and avoid dependency on products such as payday loans and other high cost loans.
Fair For You collaborated with Iceland to create this new scheme last year, in 2022. Simon Dukes, CEO of Fair For You, said to Grocery Gazette, “This loan is for those who can’t get credit anywhere else, who just need that extra bit of money to smooth over the holiday period.”
Due to the current cost of living crisis, many families have one or more parents out of work. Even families with two working parents are struggling to feed the entire household due to stagnant wages and increasingly expensive groceries. Many parents are forced to spend hours comparing each supermarket to shave down the cost and make a budget on their weekly shop wherever possible.
When Is The Scheme Available?
This issue of food poverty regularly becomes exacerbated during school holidays. Many children who were previously benefiting from free or cheap school meals are instead eating at home during the holidays. This puts an increased burden on parents, who are struggling to scrape together the funds to pay for these extra meals.
Iceland was noticing a drop in customers during school holidays, which is why they approached ethical finance company Fair For You. They concluded that this drop in customers was because people were simply unable to “access funds to purchase food”. Many families were struggling under the pressure to pay for an extra meal each week and were therefore forgoing basic essentials.
The scheme is expected to help people manage low and irregular incomes, and to improve the quality of life of those taking part. The loans are available only during school holiday windows to ensure they are used for smoothing out incomes rather than inducing permanent dependence. Iceland hopes that the Food Club will help a significant number of people to break out of food poverty. There are currently 8.4 million people in food poverty in the UK.
How Can I Apply?
The scheme opened in August 2022, and applications are open to anyone. It may be too late to apply for the Christmas holidays, as loans needed to be approved by December 9 to make sure cards could be delivered to homes in time for the Christmas break. More than 4,000 people applied for the scheme when it opened for December 2022.
The Iceland Food Club loans are interest-free as Iceland is paying the interest itself. Customers can choose which day they pay back and can pay back early if they wish. The preloaded cards can be used at Iceland and Food Warehouse stores, and people relying on benefits can also apply, as long as they have a regular income.
