Exploring ‘alternatives’ in the consumer credit market: community development finance institutions in the UK

In this paper, we use the concept of ‘alterity’ to explore the hallmarks and transformative potential of Community Development Finance Institutions (CDFIs) in the UK consumer credit market. By providing small, short-term personal loans to individuals on low incomes (i.e., microcredit), these lenders act as an alternative to exploitative forms of subprime lending, which have proliferated as a consequence of cuts in welfare state provision and growing income insecurity. In-depth interviews (n=23) were conducted with lenders and stakeholders and a typology of ‘alternatives’ was developed in relation to the clients of CDFIs and their role in the consumer credit market. Our contribution to knowledge is twofold: we provide a nuanced picture of ‘alterity’ in finance, finding that CDFIs embody multiple ‘alterities’ at the same time, and we extend the conversation about alternative and
sustainable finance to the consumer credit market, which is an overlooked, yet critical, area.