Cash-strapped Leeds families are being reminded that high-cost payday lenders are not the place to go for extra money this Christmas, and that alternative lenders are available, offering a more affordable, ethical option.
This festive season, Leeds City Council is joining forces with the Leeds City Credit Union to make sure people know that if they are looking for a low cost loan, they should try the credit union first.
The new seasonal awareness drive is part of the wider ‘Take a Stand’ campaign against high-cost lenders.
The YEP has previously reported that up to 60,000 people in Leeds could be forced to use high-interest lenders. Around 22,500 people are believed to have taken out payday loans to pay their bills.
Councillor Keith Wakefield, leader of Leeds City Council said: “Christmas can be a very stressful time of year for many people, especially those who are already struggling financially or worried about getting into debt. It is also a time when so-called payday lenders increase their advertising tactics, often targeting those who can least afford it.
“Marketing of well-known brands has convinced many people to think of payday loans as normal, and an easy way out of their problems. However, loans of this type can lead to debts spiralling out of control.
“The Leeds City Credit Union is a realistic alternative – offering low-cost, easy-access loans but without the extortionate interest rates.”
Some interest lenders charge interest rates of more than 5,000 per cent, whereas a typical APR from the credit union is 26.8 per cent.
Leeds City Credit Union is also accessible to people with a wide range of financial circumstances, and loans can be paid off at a timescale that suits the individual.
Coun Wakefield added: “Hopefully this campaign will start a shift in public thinking, so that credit unions become the go-to place for accessible loans rather than high-cost lenders.”