Welsh Government claims growing awareness of credit unions helping to tackle poverty

Credit unions offering low cost ways of borrowing are helping to tackle poverty, the Welsh Government has claimed.

Local Government and Communities Minister Carl Sargeant has said organisations like Islwyn Community Credit Union and Caerphilly-based Smart Money Credit Union are offering alternative and cheaper means to borrow than high street lenders and pay day loans companies.

Mr Sargeant has pointed to recent research that awareness of credit unions in the South Wales Valleys has grown from 14% to 45%.

To assess public awareness of credit unions in Wales, the Welsh Government commissioned three questions in the Wales Omnibus Survey in June 2012.

The Minister said that with a network of 34 Credit Union offices and 256 collection points across Wales, credit unions now operate close to many communities and offer convenient access to a safe way to save and borrow.

He said: “As ethical providers of basic financial services, credit unions play a vital part in delivering on the Welsh Government’s commitment to tackle poverty. This is especially important in deprived communities in places like the South Wales Valleys.

“It’s great to see that people are increasingly aware of credit unions and I would encourage everyone to join their local outlet. Members can benefit from personal loans at affordable rates of interest and so avoid taking out high cost loans from payday loan companies and doorstep lenders.

“Credit unions are an important part of our efforts to tackle poverty and develop responsible and affordable credit options for everyone in Wales.”

Jeff Cuthbert, Caerphilly AM, is a supporter of credit unions.

He said: “I am proud to be a member of Smart Money Credit Union and urge residents to sign up and take advantage of a Credit Union’s benefits.

“Local Credit Unions offer an accessible, low risk and easy place to save money, and give access to low cost loans. Many now offer other services such as ISAs, budgeting advice, insurance products and debt management.

“At a time where families are saving up for Christmas it is important that families do not feel forced to turn to unscrupulous loan sharks that charge interest at sky high rates and credit unions offer a viable alternative to these.”