'Bank of Bournemouth' pilot delayed
- 20 January 2014
- From the section Dorset
A council scheme for Dorset residents to apply for small business loans and mortgages has been delayed.
The pilot scheme, unofficially dubbed the "bank of Bournemouth" has been stalled by "complex legal frameworks", the borough council said.
Small business loans of up to £10,000 were supposed to be available from November last year and mortgages of up to £150,000 early in 2014.
The council said it hoped its pilot would start within six months.
Bournemouth Borough Council's cabinet approved the pilot community finance company to help out local residents and businesses using £15m of unallocated capital reserves,
'New and unusual'
But setting up a loans company as well as a mortgage company has taken longer than expected.
Council leader John Beesley said its Consumer Credit Licence was granted in November, but that compliance regulations for the licence were changing in April.
"We have decided to wait until the new regulations come into force from 1 April," he said.
"We shall therefore only need to undertake this work once."
He added that preparations for the mortgage scheme were continuing.
It is estimated the scheme, once up and running, will give the council an £8m return over 10 years.
The pilot was supposed to run until March 2015, but the council cannot confirm whether this deadline will now be extended.