Credit Unions Offer Lifelines to Financially Struggling Families Avoiding Loan Sharks

Friday 26 January 2024

At a time where family finances are feeling the squeeze, credit unions have stepped up to offer safe and sensible credit to those in need. Unfortunately for some, where mainstream borrowing is not an option, they turn to illegal money lenders.

Reported in The Sun, Lewisham Plus Credit Union was a lifeline for mum-of-three Sherifa from Lewisham. Sherifa’s job as a part-time healthcare assistant provides a monthly income of £1,200 – £1,400 which often does not even cover her rent. Despite also receiving Universal Credit, money was too tight. Thankfully Sherifa turned to Lewisham Plus Credit Union for a loan when she had moved into an unfurnished property.

The South London mum applied for a loan of £3,000 to buy essentials for her property and the credit union came back offering her £1,000. She said: “Giving me less was the right thing to do. I paid back £50 a week and when I got it down to £440 by February a year later.

“Then I applied for another £2,100 from them after my mum got ill in Jamaica so I could fly back to see her.”

Lewisham Plus issued the second loan at a lower rate of 19.6% APR because she’d kept to her previous repayment plans which allowed Sharifa to repay the loan quicker and has now paid off the loan entirely.

Reflecting on her experience, Sharifa said the credit union was a “massive lifeline” for her and that “The people at the credit union are very approachable. When I went to sign for my first loan, they also gave me some shoes for the children.

“With hindsight, I am glad I didn’t get that credit card and I don’t need it now that I have the credit union.”

Robert Kelly, ABCUL CEO said “This positive story is just one of thousands of examples where credit unions have changed lives for the better. Credit unions continue to offer safe alternatives to loan sharks while treating members as individuals. It is touching to see Lewisham Plus go the extra mile by giving shoes for this member’s children, a gesture which exemplifies the caring nature of the sector”.

Source: The Sun