More Soldiers Taking Advantage of Loan Program, Army Says


Use of the Army's troop loan program is up more than 10 percent after a policy change last year made it easier for junior enlisted soldiers to get loans, officials said.

The change, which went into effect Sept. 9, 2015, removed a rule that required E-1 to E-4 soldiers to receive approval from their commander or first sergeant before requesting an emergency loan through the Army Emergency Relief (AER) program.

In the six months after the policy changed, loan requests went up 10.6 percent compared to the same six months the previous year, said Charles Durr, a retired Army command sergeant major who oversees assistance for AER.

The system also saw an increase over that same period in the number of first-time AER users, he said. While 1,642 first-time applicants used the program between Sept. 9, 2014, and Feb. 9, 2015, 2,200 first-time users received loans after the policy change between those same dates in 2015 and 2016 -- an almost 34 percent increase, Durr said.

AER loans come with 0 percent interest and are generally repaid through paycheck allotment.

Any enlisted soldier who has served at least a year, completed basic and advanced individual training (AIT), and isn't listed as a high financial risk can apply directly to AER for a loan. Officers can also use the program without restrictions. All soldiers are limited to two AER loans per year without command approval.

Officials said they give all credit for the use increase to the policy change, which was designed to move soldiers away from off-base payday lenders with high interest rates and into the AER system.

"We wanted to give those soldiers who exhibit no high-risk behaviors ease of access without fear of stigma or drilling from the immediate unit leadership as it relates to getting assistance," Durr said. "It's to protect them from predatory lenders. When they go out and use those, they are digging themselves a bigger hole."

AER distributed more than $71 million in loans and grants in 2015, according to its website. The effort is funded through charitable contributions, including from individual soldiers through paycheck allotments.

This year, the system will launch an online application process that will allow applicants to request a loan and upload supporting documents through the program's website. That program is set to go live late this year.

-- Amy Bushatz can be reached at

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