Dragonsavers Credit Union saves members £1.3 million in debt repayments


Dragonsavers Credit Union has revealed it saved more than 2,100 people across Rhondda Cynon Taf around £1.3 million in debt repayments over the past year, compared to using a payday lender.

As Christmas rapidly approaches, credit unions across Wales are helping even more people bridge the financial gap caused by the Covid-19 lockdown.

During this prolonged period of financial insecurity the ethical savings and loans providers, who offer small loans at affordable rates, have a clear message for the Welsh public – “You’re better off with us”!

The news comes after the Financial Ombudsman revealed it had upheld 70% of complaints against payday loan companies over the past year.

Christina Stoneman, General Manager for Dragonsavers Credit Union, said: “This staggering amount of money shows how, at this crucial time for the nation’s finances, credit unions help people to avoid financial hardship, worry and debt which affects communities in Rhondda Cynon Taf.

“It’s never been truer to say that you really are better off with us.”

On an average £800 loan repaid over a year, people borrowing with Dragonsavers Credit Union would pay a total of £954 over 12 months.

A typical lender, in this case Satsuma, offers the same loan over the same period the total amount repaid is £1,593, £639 more than Dragonsavers.

Member of the Senedd for Rhondda Leanne Wood said: “Credit unions provide a valuable lending service to people who find it hard to get credit through more traditional means such as banks.

“The interest rate of credit unions is typically considerably lower than payday loans which charge extortionate rates and are responsible for people slipping into horrendous debt. I would urge anyone needing to borrow money to do a comparison test with a credit union like Dragonsavers to see how much they can possibly save you in interest payments. The sum of money saved is often significant. I am a member and would encourage everyone else to join.

“Thousands of people in the Rhondda have been helped by Dragonsavers already – their track record speaks for itself.”
During the past year a sample of 13 credit unions found that people in Wales saved between £13.5 million and £15.9 million by choosing a credit union over a payday lender.

If you borrowed £1,000 over 12 months then the difference between a credit union and a payday lender would be:

 

Credit Union

Satsuma

Provident

Amount of Interest

£205.52

£992.00

£872.00

Monthly Repayment

£100.46

£166.00

£156.00

Total Repayable

£1205.52

£1992.00

£1872.00

*Figures correct as of 18 June 2020

As a financial co-operative, Dragonsavers Credit Union offers affordable, ethical loans and savings to people across Rhondda Cynon Taf.

Christina Stoneman added: “Our members are not treated as a credit score and despite being turned away for a loan from other high street institutions, may still be able to borrow from us.

“Interest from a credit union loan is charged on the reducing balance of the loan, there’s no hidden charges or penalties for paying it off early, and many applicants receive free life insurance.”

To find out more about Dragonsavers Credit Union, go to www.dragonsavers.org

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