FAIRshare Affordability Criteria

Learn how your loan application is assessed for affordability

When you choose to borrow from FAIRshare, your application will always be based on our assessment of your affordability. We are regulated by the Financial Conduct Authority (FCA), who have issued guidance on assessment of affordability.  Their policy is that we must assess all loan applications on the ability of the applicant to repay that loan, now, and in the future, using only details of your income and expenditure. 

This can be difficult to assess, given the complex nature of some household finances and the use of joint bank accounts. That’s why we encourage anyone considering borrowing from FAIRshare to use the Open Banking facility to your bank accounts. This provides secure, read-only access to your accounts so we can have a more detailed understanding of your affordability.

From the information you allow us to view, our system calculates the average amount of money you have left at the end of each month, for the previous 6 months.  In keeping to the with the guidance from the FCA, it is our policy to use only a quarter (25%) of that average amount you have left over in making our affordability assessment.  This is part of how we make responsible loan decisions and to ensure, when we do lend, that we add minimal financial pressure to the household budget.   

Open Banking…

In addition to your income, we consider any other outstanding loan repayments you may have. We also take into consideration the account conduct and the nature of regular transactions. We assess the impact of how an increase in borrowing would affect the reduction average in disposable income. We generally work out income and expenditure from the previous three months’ worth of transaction.

When we consider these factors, we decide whether you can borrow or extend borrowing with FAIRshare.

We understand that if you do not meet our affordability criteria and your loan application is declined by our Loan Officer this can be disappointing. We do encourage anyone who is declined to see details of local and national agencies that might be able to support you with independent financial advice or budgeting support. These can be found in our Cost of Living section of our website. You can still join FAIRshare and enjoy the benefits of saving with your local Credit Union. If your circumstances change, you are welcome to reapply after six months of your unsuccessful loan application.