Leeds Credit Union launches loan shop to fight back against pay day loans
Caption: The newly opened Leeds City Credit Union loan shop on Roundhay Road.
Leeds City Credit Union is taking the pay day loan battle to the streets as it opens the first ever credit union loan shop in Leeds.
The loan shop, located at 265 Roundhay Road will be known as 'Your Loan Shop' and will offer people the chance to speak to someone face to face about easy, affordable loans.
The shop will be able to offer savings to applicants of over £800 in the case of someone applying for a £1000 loan. A £1,000 loan from the credit union for 12 months will cost £135 in interest at an APR of 26.8%. An equivalent loan £1,000 loan over 12 months from a high cost lender* will cost £957 in interest at an APR of 299%.
People will also be able to sign up for a loan online at www.yourloanshop.com
The loan shop continues the work within the city around raising awareness of other, more affordable, local alternatives to pay day loans, which has included the 'Take a Stand' Campaign in late 2013 and the launch of the Money Information Centre website (www.leedsmic.org.uk) earlier this March, signposting people to finance and debt advice in Leeds.
Chris Smyth, Chief Executive of Leeds City Credit Union said:
“It’s time that we reclaimed our high streets from the high cost money shops that have plagued so many neighbourhoods in recent years.
“By providing affordable credit union loans we intend to significantly undercut the excessive rates of interest, that the high cost money shops charge.
“What’s more the credit union, unlike the payday and high cost loan shops, will take care when giving credit – we carefully check that a person applying for a loan can afford the repayments.
“We have designed the shop to be friendly and welcoming where people can speak to us with confidence about their borrowing needs. Visitors will be able to join the credit union too and gain access to our other services including savings schemes.”
Councillor Keith Wakefield, leader of Leeds City Council said:
“We are working closely with Leeds Credit Union on the battle against pay day lenders in the city, and the new loan shop is yet another step towards making Leeds a pay day lending free city.
“We want to continue to encourage people to take advantage of responsible lenders in the city such as the credit union to get a better understanding of how they get out of debt, but also what other options may be available to them."
Notes to editors:
Leeds City Credit Union is a financial cooperative set up to give members access to affordable loans at a fair rate of interest and competitive savings plans. Credit Union members enjoy our straightforward, honest approach to their money.
Leeds City Credit Union is a community focused organisation with 33,000 members and is one of the largest in the UK
Leeds City Credit Union is a ‘Mutual’, meaning that it is owned members for member benefit alone.
Leeds City Credit Union Ltd is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Members savings are covered by the Financial Services Compensation Scheme, so the first £85,000 of a member’s savings are completely safe.
* Sources: Cost saving referred to above calculated by comparing the cost of a credit union loan repaid weekly over 52 weeks to a similar loan from Ladder Loans on 31.07.14. Note some high cost lenders charge considerably more.
For more information contact:
Leeds Credit Union
Leeds City Council communications team