Emergency loans vary greatly between cities, with interest ranging from 2.4 to 8%

There is a vast range in interest rates offered as alternative financing from lenders operated by municipalities, or on their behalf. The money is often meant for unexpected expenses incurred by people with not enough income or assets to visit a traditional bank. Interest rates for these social loans range from 2.4 percent in Nijmegen up to 8 percent in Groningen, according to an analysis of several lenders by NOS.

The difference can be substantial, especially for people in financial distress. Someone who takes out a loan of 500 euros at 2.4 percent interest would have to pay about 524 euros after a two-year period, and less if they make monthly payments. At a rate of 8.0 percent, that rises to 583 euros.

The loans provided by the city credit banks can cover a wide range of unexpected costs and emergencies. Many cities only provide the loans to people earning a maximum of 130 percent of the minimum wage.

Nijmegen went for its rate of 2.4 percent by knocking 4 percentage points from the average offered by commercial banks. "The choice for this social policy was made about ten years ago," a spokesperson told NOS.

Groningen's higher rate is "because there must be a certain degree of cost coverage," the city told NOS. The interest paid covers a portion of the credit bank's operations.

Rotterdam offers loans of 3 percent to people earning less, while Breda and Tilburg offer 3.5 percent interest rates. That rises to 7.2 percent in Eindhoven, NOS Reported.

In The Hague, the interest rate is 4.65 percent, but the city's credit bank also provides mortgages to people who are rejected by commercial lenders. "As far as we know, The Hague is the only municipality that does this," said a spokesperson to NOS.

Amsterdam offers loans at 3 percent to people with lower incomes based on what they can afford in monthly payments. Those with higher incomes can take loans at 8 percent from the capital's lender, according to the city's website.

"When people come to us for a broken refrigerator or something similar, in practice we always offer a solution through Special Assistance. That is a gift, not a loan," said a spokesperson for Utrecht. The city does not generally offer a social lending platform to its residents.

"If, in exceptional cases, a loan is taken out, we will offer it without interest."