Credit Unions Among First Lenders to Offer Government-Backed Warm Homes Loans

27/10/2026

The Money Co-op and South Manchester Credit Union are among the first lenders approved to participate in the UK Government’s Warm Homes Loan Scheme, helping eligible homeowners access affordable finance for energy-efficient home improvements.

Launching on 28 October 2026, the scheme is backed by the Department for Energy Security and Net Zero (DESNZ) and HM Treasury. Government funding enables approved lenders to offer reduced interest rates on eligible home improvements, including solar panels, battery storage systems and low-carbon heating technologies such as heat pumps.

The Money Co-op and South Manchester Credit Union are among the first ten lenders approved to participate in the scheme, demonstrating the important role credit unions can play in helping households access affordable finance while supporting the transition to more sustainable homes.

Through the scheme, eligible homeowners can access loans at reduced interest rates, with the amounts, rates and repayment terms depending on the participating lender and the improvements being financed.

The Money Co-op’s Warm Home Loan will allow eligible new and existing members to borrow between £7,500 and £25,000 at 2.7% APR, subject to the scheme’s requirements and the credit union’s usual lending and affordability assessments.

South Manchester Credit Union will offer eligible residents of Central and South Manchester loans of between £1,000 and £15,000, with an APR from 3.6% and repayment terms ranging from three to 9.8 years.

Both products are designed to help homeowners spread the cost of eligible energy-saving improvements rather than having to meet the full upfront expense.

Participation in the Warm Homes Loan Scheme brings these values together with the growing need to make homes more energy efficient and help households manage their energy costs.

Ciara Davies, Chief Executive of The Money Co-op, said: “The Money Co-op is proud to be one of the first lenders to participate in the Warm Homes Loan Scheme. As a not-for-profit co-operative, we believe access to affordable finance can play an important role in helping people make their homes warmer, more energy-efficient and more affordable to run.

“Taking part in this scheme is a natural fit with our credit union values of putting our members and communities first, while supporting a fairer, more sustainable future.”

The Money Co-op is also working locally with Greater Manchester Combined Authority (GMCA) and People Powered Retrofit, a specialist retrofit co-operative, to help connect affordable finance with expert advice and support for greener home improvements.

The collaboration reflects a shared ambition to help more households overcome the barriers to investing in energy-saving measures.

Sheenagh Young, Chief Executive of South Manchester Credit Union, said: “Autumn is the perfect time to launch the Warm Homes Loan Scheme. As energy prices keep rising and more people are looking for innovative ways to keep their homes cosy and comfortable, we are proud to stand ready to deliver Warm Homes Loans to the residents of Central and South Manchester.

“Community credit unions are ideal partners for this national scheme as we are trusted by local people to serve them with safe financial products designed to build long-term financial health and wellbeing. Protecting Planet Earth is also a mission which is close to our hearts.”

For more information, visit the credit unions’ websites:

• The Money Co-op: Warm Home Loan
• South Manchester Credit Union: Visit the credit union’s website for details of its Warm Homes Loan, eligibility requirements and application process.

The Warm Homes Loan Scheme is a UK Government initiative led by the Department for Energy Security and Net Zero. Participating lenders remain responsible for their lending decisions and affordability assessments, and all loans are subject to eligibility criteria and approval.