Progress Loans

Our approach

Progress Loans give people in Victoria on low incomes access to loans of between $500 and $3,000 to pay for essential household items (or up to $5,000 for a car). This is a joint program of ANZ and the Brotherhood of St Laurence.

From 29 February 2012, Progress Loans is no longer available to new applicants. ANZ is committed to its long-standing partnership with the Brotherhood of St Laurence and will continue to invest in our other financial inclusion and capability programs, including Saver Plus and MoneyMinded. More information about ANZ’s financial inclusion and capability strategy will be available soon.

The Progress Loans story

The Progress Loans program was launched in May 2006 in response to ANZ-commissioned research conducted by Chant Link & Associates into financial exclusion in Australia.The program concluded early 2012.

The research showed that many people struggle to access low-cost, fair and safe financial services from mainstream providers - meaning they either go without, or resort to credit on unfavourable terms from non-mainstream providers.

The Progress Loans program was the culmination of more than 18 months of consultation and development work by ANZ and the Brotherhood of St Laurence to ensure that it met the needs of people on low incomes.
How Progress Loans works

The Progress Loans program aimed to:

  • be affordable for customers with transparent fees and charges
  • be financially viable in the long-term
  • effectively reach as many eligible customers as possible
  • build a sense of dignity, empowerment and confidence among customers.

To be eligible for a Progress Loan, applicants required a Health Care Card or Pensioner Concession Card issued by Centrelink, have lived in the same residence for more than six months, and had to  be able to demonstrate an ability to make regular repayments.

Since Progress Loans began, the program has helped hundreds of people on low incomes obtain credit to make essential household purchases. Credit quality and arrears for Progress Loans compare well with ANZ's overall personal loan portfolio.
Case study: Assessing the impact of Progress Loans

Anita is a middle aged sole parent, and her Progress Loans experience shows how accessible and safe credit can help those on low incomes build a more secure future.
Anita used a Progress Loan to help start a childcare business, which assisted her to become independent from Centrelink. The successful venture has increased her self confidence and given her financial freedom. Her business is expanding and she is undertaking additional study to further develop her skills.

"I was a bit nervous at the time because I had never had a loan before. In the end [the process] was very straightforward.”

“The minute I started, [the business] took off. I used to get $470 per fortnight from Centrelink and now I earn $1,200 per week. Plus having to work is fantastic. I look forward to getting up every day.”

“The greatest benefit is that I am independent. I feel so much better about myself. I have a new aim in life and it has boosted my confidence as well. My health has improved too. I have so much energy and 1000% happier than I was six months ago.”

“[I have] great respect in the eyes of my children. They are so proud of me. They have never seen me working and we have so much to talk about.”

2011 results

In 2010, the Australian Government provided funding ($1 million) to ANZ and the Brotherhood of St Laurence for piloting alternative, lower-cost distribution models for the program, as a means to increase access to Progress Loans.

From 2010 to 2011, we piloted branch and telephone distribution models, making the program available outside of Victoria for the first time. The Brotherhood of St Laurence piloted a community engagement plan via a Community Champion model. During this time, we achieved 982 new loans, worth $1.8 million.

Purpose of loan

General metrics 2011 2010
Number of locations 3* 3
Total applications 667 504
Total approved 558 424
Percentage approved 84% 84%
Number of loans drawn 484 454
Lending total $1,872,306 $1,321,704
Average loan size $3,868 $3,278

* An ANZ telesales pilot (March 2011 - March 2012) made the program available nationally.

2010 results

In 2010, the Australian Government provided funding ($1 million) to ANZ and the Brotherhood of St Laurence for piloting alternative, lower-cost distribution models for the program, as a means to increase access to Progress Loans.

We are seconding Progress Loans Officers to selected branches to build awareness of Progress Loans among branch staff, and are trialling an over-the-phone service for the loans. The Brotherhood of St Laurence is piloting a community engagement plan via a Community Champion model. Our goal is to achieve 1,000 new Progress Loans between 2009 and 2011 and we are on track to achieve this goal with almost 500 loans, worth $1.3 million, provided to date.

Progress Loans - Purpose of loan

 

General metrics 2010 2009
Number of locations 3 3
Total applications 504 363
Total approved 424 299
Percentage approved 84% 82%
Number of loans drawn 454 278
Lending total $1,321,704 $699,550
Average loan size $3,278 $2,481

 

 

2009 results

278 new Progress Loans were provided in 2009, just short of our target of 300. 82% of loan applications were approved, with an average loan size of $2,481. 57% of loan customers were women, and there was only one default for the year.

Progress Loans - Purpose of loan

General metrics 2009 2008
Number of locations 3 3
Total applications 363 403
Total approved 299 322
Percent approved 82% 79%
Number of loans drawn 278 294
Lending total $699,550 $624,064
Average loan size $2,481 $2,130

Program evaluation research has been completed, showing that Progress Loans are successful in meeting the needs of low income people through providing access to safe and affordable loans. We are now working with the Brotherhood to incorporate the recommendations.

Progress Loans received a $1 million grant from the Australian Government as part of its $50 million initiative to build better financial capability and resilience in the community.

The future

ANZ will extend and continue to pilot alternative delivery models for Progress Loans, in partnership with the Brotherhood of St Laurence.

2008 results

More than 300 Progress Loans were approved during 2008 exceeding our target for 2008. The majority of people receiving a Progress Loan are women (64%), and the most common items purchased are cars (28%).

In April 2008, ANZ and the Brotherhood of St Laurence received the Prime Minister's Award for Excellence in Community Business Partnerships for Progress Loans. See the Media Release about the Award (PDF 72kB).

Progress Loans - Purpose of loans

General metrics 2008 2007
Number of locations 3 2
Total applications 403 301
Total approved 322 209
Percent approved 79% 69%
Number of loans drawn 294 179
Lending total $624,064 -
Average loan size $2,130 $1,722

The future

The full evaluation of the pilot program will be released towards the end of 2008. In the meantime, ANZ has committed to approving a further 300 Progress Loans in 2009.

 

You need Adobe Reader to view PDF files. You can download Adobe Reader free of charge.