Borrow money from a social credit bank

If you belong to the minimum income in a municipality, you can benefit from many benefits. One of the options is to take out a social credit with the credit bank in your region. This is useful if you can no longer get a regular loan from a commercial lender. A credit bank does not make a profit, so you do not pay too much interest.

How does borrowing from a social bank work?

A loan from the social credit bank is tailor-made. Depending on your financial situation, the maximum possible amount that can be borrowed is determined. It is also agreed when the loan has been paid off. A social credit bank also looks at your personal situation to determine whether and when you can repay the loan. So you know exactly where you stand.

The term of a social loan

The term of a social loan is subject to certain rules. The minimum term can be a few months, while the maximum term cannot exceed 60 months (5 years). You must repay the loan within the maximum term. The average term of a social loan is often 3 years (36 months).

The interest owed and maximum amount that can be borrowed

A social loan has a fixed interest rate. The amount you pay each month to repay the loan is therefore equal and predictable. This way you can take it into account in your monthly expenses. The minimum amount to borrow is 225 and the maximum amount is 25,000. The money can be used for all kinds of things. You are free in this.

Interest rates for a social loan

By

Until

Interest rate

0

2,500

10.0%

2,500

5,000

10.0%

5,000

7,500

8.9%

7,500

10,000

8.9%

10,000

25,000

8.7%

(interest as of November 2009)

Loan amounts at social assistance level

Family situation

Income per month

Maximum amount

Repayment per month

Single

867.41

1,705.00

54.70

Single parent

1,115.23

2,195.00

70.42

Married/cohabiting

1,239.15

2,435.00

78.11

(amounts as of July 1, 2010)

Conditions for a social loan

To be eligible to borrow from a social credit bank, you must meet certain conditions. Not everyone can get a social loan. The conditions you must meet are:

  • you are 18 years or older
  • you have a regular income (wage or benefit)
  • you live in the Netherlands
  • your income does not exceed 130% of the minimum wage (exceptions are possible)
  • you have a valid passport or ID card

Social loans are also provided to people who:

  • have a damaged credit history
  • to be in debt
  • be 65 years or older
  • cannot obtain credit elsewhere without additional collateral

Apply for a social loan

To apply for a social loan, you must collect a form from the social credit bank in your region. Some credit banks offer this via the internet, but you usually have to collect a form at the counter yourself. You can then immediately make an appointment to discuss the application.