High-street banks may have to lend to poor

Government considers US-style community reinvestment schemes

The Community Development Finance Association has welcomed a suggestion by communities secretary Hazel Blears that high-street banks should be forced to lend to people in deprived communities.

Blears told the Commons last week that officials in the Communities and Local Government department were looking at US-style community reinvestment models, which require banks to plough some profits into providing finance to poorer communities.

Bernie Morgan, chief executive of the CDFA, which represents institutions specialising in lending in deprived communities, said she welcomed Blears's suggestion.

She said she wanted to see credit directed through the 70 Community Development Finance Institutions she represented, which have experience in lending to businesses and individuals in deprived areas.

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