Iceland Foods has brought back its “ethical” interest-free microloans scheme for the 2026 school holidays.
Returning for its fifth year, the Iceland Food Club provides shoppers with interest-free loans of up to £100 that can be spent on groceries and household items from Iceland or Food Warehouse stores.
It is operated in partnership with the not-for-profit lender Fair For You. Shoppers receive their loan on a pre-paid card, then pay back £10 a week. Iceland covers the interest rate, effectively making the loans interest free for the shopper.
The top-up window opened on 13 July and will run until 2 September.
The scheme is returning to support shoppers during the summer holidays. It can be one of the most challenging periods for families as the school food clubs or free school meals that many rely on only run during term-time, leaving household budgets stretched.
“School holidays bring real pressure for many households,” said Richard Walker, Iceland Foods executive chairman.
“The Food Club gives families breathing space, helping them avoid the trap of predatory lenders while ensuring they can afford the essentials. We’re proud at Iceland to continue offering practical support where it’s needed most.”
40,000 shoppers used Iceland’s scheme
Iceland first piloted microloans in 2021 in response to the Covid-19 pandemic.
The microloans originally had an interest rate equivalent to 55.6% APR. However, Iceland began subsidising the interest when the scheme was relaunched nationwide in August 2022. Iceland Food Club won Social Impact Initiative of the year at the 2025 Grocer Gold Awards.
More than 40,000 families had made use of the scheme since it was launched, Iceland said. One of those is Jane Griffiths, a mother of six from Connah’s Quay in Wales who works part-time.
“School holidays can be chaos when you’ve got children and grandchildren constantly in and out of the house asking for food. The Food Club has really, really helped my family. Having six children, including a son who was born prematurely and is partially sighted and deaf, there are always extra costs and challenges to manage,” Griffiths said.
“When the children break up from school, it’s a huge worry trying to make sure there’s enough food in the house for everyone. Without the Food Club, I’d be looking at other ways to get by, whether that’s turning to a food bank or taking out a high-interest loan and paying back more than I borrowed. The fact Food Club is interest-free gives me peace of mind, because I know I’m getting support without getting into debt,” she added.
Among microloan users, 71% of families reported improved diets, while the number of families who reported eating fruit at least three days a week increased by 41%, Iceland said, citing research into the programme’s impact from the Centre for Responsible Credit.
“Affordable credit changes lives,” said Simon Dukes, CEO of Fair For You. “The evidence and stories like Jane’s speak for themselves.
“The Food Club supports families at moments when budgets are most stretched, helping parents keep healthy food on the table without going hungry themselves or turning to high-cost alternatives.”
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