Credit Union hands out £3.2m to cope with the cost of Christmas
A CREDIT union facility in Yorkshire loaned more than £3m in three months to help people struggling financially in the run up to Christmas.
Figures show that between October and December, £3.2m was handed out across Leeds and Wakefield.
The Leeds City Credit Union, which has 36,000 members, revealed the statistic as it approaches its 30th anniversary.
It also claims that it saved borrowers £1.6m in interest payments, compared to doorstep lenders.
The credit union can charge repayments at interest rates as low as 4.9 per cent, which means that borrowers will have paid around £1.6m less in interest rates than they would have done had they sought financial assistance from ‘money shops’ and pay day loan companies.
Chris Smyth, chief executive of Leeds City Credit Union, said that saved cash is a boost to the economy as it stays in local pockets rather than those of high cost lenders.
He added: “I am extremely pleased that the credit union has been able to help the local community save £1.6m in interest charges in the run up to Christmas.”
In the last 10 years the organisation calculated that it had saved the community £47m worth of interest payments and had issued £92m worth of loans.
It had provided finance to 110,000 people and issued £265m of cash via community branches.
One case study reveals a man suffering from depression had gone without gas or electricity for at least two years. His illness had left him struggling to do daily activity and led to him getting into financial difficulty.
He fell behind with payments on his pre-paid meter and did not have enough income to pay the arrears to restore the services.
He was referred to the union by housing services and after a grant to pay the outstanding amount was turned down, the union worked with his sister, using money left to them following their father’s death, to pay for the electric to be put back on. A grant was successfully applied for to cover arrears owed to the water trust and housing benefits were backdated to leave a lesser amount owed.