Leeds Credit Union hands out £3.2m in three months to ease woes

Chief Exec Chris Smyth and Leeds City Council Leader Counc Keith Wakefield at the new Credit Union shop 'Your Loan Shop' in Roundhay Road, Leeds.  14 November 2014.  Picture Bruce Rollinson
Chief Exec Chris Smyth and Leeds City Council Leader Counc Keith Wakefield at the new Credit Union shop 'Your Loan Shop' in Roundhay Road, Leeds. 14 November 2014. Picture Bruce Rollinson
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More than £3m has been provided by Leeds City Credit Union in just three months to people struggling with their finances.

The union, which is approaching its 30th anniversary, has saved borrowers £1.6m in interest payments compared to doorstep lenders.

It also revealed to the Yorkshire Evening Post some of the extreme cases it has dealt with, including one man who had gone without gas and electricity for two years.

In the run-up to Christmas, from October to December, Leeds City Credit Union loaned £3.2m to some of its members 36,000 members across Leeds and Wakefield.

As the credit union can charge interest rates as low as 4.9 per cent, it means that borrowers will have paid around £1.6m less in interest rates than they would have had they sought financial assistance from ‘money shops’ and pay day loan companies.

Chris Smyth, the 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.

Mr Smyth 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.”

As the 30th anniversary approaches, Leeds City Credit Union revealed that in the last 10 years it had saved the community £47m of interest payments and had issued £92m of loans to cases such as this from West Leeds.

The resident, who did not want to be identified, had suffered depression for years, affecting his ability to take on daily activities and his financial position suffered.

He was referred to the Leeds branch by Bramley housing office and it took a while for staff to gain his trust.

After getting behind with payments on his pre-paid meter, he did not have enough income to pay the arrears to restore the services.

A grant to pay the outstanding amount was turned down so, using funds left to him and his sister following their father’s death, his sister paid 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.

IMPACT OVER LAST TEN YEARS

Based on lending over the last 10 years -

£265m worth of cash has been issued via the credit union’s community branches

£92m worth of loans have been issued

110,000 loans have been issued

£47m worth of interest re-payments have been saved to the community

Every £1 spent on financial inclusion work is worth £9 for the local community.

Leeds Credit Union is a financial co-operative set up to give members access to affordable loans at fair and competetive rates of interest.