evaluation
Evidence type: Evaluation i
Information about the programme design and rationale
Evidence about Financial Capability outcomes for programme participants
Evidence that the Financial Capability outcomes were caused by the programme
Evidence about programme implementation, feasibility, and piloting
Evidence about relative costs and benefits of the programme
The No Interest Loan Scheme (NILS) is a community-based programme provided by Good Shepherd Microfinance (GSM) offering loans of up to $1,800 to low income individuals in Australia to purchase essential household goods or services. NILS loans carry no interest or fees and are “circular community credit”, whereby the repayment of one NILS loan provides funds for another NILS loan to be financed in the community. NILS providers also offer financial advice to clients.
The programme aims to improve clients’:
NILS has reached 125,000 people through 257 community-based organisations across Australia. It has a target of reaching one million people on low incomes over the next five years.
This evaluation by the Centre for Social Impact comprised stakeholder workshops and a literature review to inform the outcomes framework, as well as quantitative monitoring data from 294 accredited programmes and a representative telephone survey of 710 NILS clients.
A social and economic impact analysis was also conducted, based on the outcomes recorded in the survey.
The evaluation found positive impacts in relation to the following outcomes:
Financial and wider wellbeing:
Financial behaviour:
Clients who received financial counselling support together with their NILS loan were more likely to experience positive financial capabilities, economic, and social and health outcomes.
Clients who received a NILS loan from a centralised (state) organisation were less likely to experience positive outcomes than clients who received a NILS loan from a franchise or independent organisation, however the flexibility of the loan criteria had no impact on client outcomes.
A social and economic impact analysis based on the client outcomes reported in the survey estimated that, for every $1 invested in a NILS loan, an average $1.59 of social and economic value was created.
NILS was also found to be successful in reaching vulnerable groups.
While the study measured a positive change amongst programme participants, there was no comparison group, so no firm causal links can be made between the programme and the outcomes measured.
It should also be noted that one recommendation of the evaluation is for a further investigation into the merits of a centralised organisational system take place, which suggests that more evidence is required to say exactly why positive outcomes were more likely to result from such a system.
Stephen Bennett, Centre for Social Impact at the University of New South Wales: s.bennett@unsw.edu.au