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Unite plans credit union community in challenge to payday loan providers

Unite plans credit union community in challenge to payday loan providers

Unite intends to make use of credit union in Salford as model for the nationwide community. It really is aslo looking for links with a number of the 400 credit unions in the united kingdom. Photograph: Christopher Thomond for the Guardian

Britain’s biggest union is mounting a challenge against payday loan providers with intends to establish a nationwide credit union community.

Unite has pledged to abolish the “Wonga week” sensation whereby families utilize payday loan providers to go down money shortfalls by the end associated with thirty days, amid extensive critique of Wonga and its particular 4,214% APR rate of interest cost. a credit that is typical – which ordinarily recruits from an area area or workplace – makes use of its deposits to produce little loans to users, making the model a viable option to payday borrowing.

Steve Turner, Unite’s director of administrator policy, stated it intends to make use of the recently launch of a Unite-backed credit union in Salford due to the fact model for the nationwide system. He stated: “we have been in conversations to try and set up a UK-wide credit union that can give use of inexpensive finance and low priced credit to huge numbers of people.