Iceland relaunches interest-free mini-loans to help families through the summer holidays

With school holidays now in full swing, the weekly food shop can feel more expensive than ever. That’s why Iceland has relaunched its popular Food Club mini-loan scheme this month, giving families an interest-free way to manage rising costs.

What is the Food Club mini-loan scheme?

The scheme, run in partnership with ethical lender Fair for You, allows shoppers to borrow between £25 and £75, interest-free, to spend at Iceland or The Food Warehouse. Returning customers can access up to £100. The money is pre-loaded onto a special Food Club card and can be used in-store or online.

Repayments are set at £10 a week, with no interest or hidden fees. There are also no late payment charges, helping families borrow responsibly without the stress or risk of falling into problem debt. Iceland says the scheme is all about offering a fair and affordable alternative to payday loans or buy now, pay later options.

Healthy bank balances

It’s easy to see why this kind of support is needed. Families are expected to spend an extra £550m on food over the summer, and many are already cutting back, turning to credit, or even selling household items to keep up. Iceland’s mini-loan scheme gives people the breathing space to buy what they need now, without making the rest of the month harder.

Since the scheme first launched in 2022, it’s helped over 31,000 households access £12.5m in interest-free credit. In previous trials, 92% of Food Club users said they relied less on food banks and 77% avoided using high-cost credit.

Healthy bodies 

To help families make the most of their money, Iceland has also teamed up with a registered dietitian to create a £75 shopping basket that covers 126 balanced meals for a family of four. It shows that with the right tools and a bit of support, you can eat well even on a tight budget.

Speaking about the scheme, Iceland’s Managing Director, Richard Walker, said:

“The summer holidays should be a time for families to relax and make memories, not worry about how they’re going to afford their next food shop.”

If you think the Food Club might help ease some of your food bill pressure this summer, you can apply online via Fair for You or ask in-store for more information. If approved, your loan will be loaded straight onto your Food Club card and you’ll start making small weekly repayments, interest-free.

And remember. The scheme is open at set times throughout the year, including summer and Christmas. So even if now isn’t the right moment, it’s worth keeping it in mind if your household budget is stretched in future.

More budgeting help

Want more ways to keep your food shop affordable? Head over to our blog for savvy tips, or try our budget planner to help you stay in control.