Credit Unions are an Underused Lending Resource for Young People Facing Financial Hardship

Friday 26 January 2024

Research published by money.co.uk states one in four 25 to 34-year-olds are relying on a credit card to pay their bills, while 18 to 24-year-olds are repaying an average £1,088 on their credit cards each month, 65% more than the UK average.

Journalist, Iona Bain asks why credit unions are underused for young people in financial difficulties and how the sector can help.

Speaking to Metro, ABCUL CEO, Robert Kelly says: “Our ethics appeal to younger customers. But whilst our strength is in our not-for-profit, member-owned set up, we can’t compete with the marketing budgets of companies looking to profit from people struggling in the cost-of-living crisis – this explains why awareness is so low.”

ABCUL told Metro, that a recent snap survey suggested strong growth in membership and loan volumes across the sector, with some credit unions reporting record levels of growth.

“Many credit unions are embracing digital transformation and on-demand customer service which is attracting younger members,” Robert added. “Credit unions offer members the safety net of access to fair affordable credit from local organisations that have their interests at heart whilst helping them build financial resilience through savings, however small.’