Merthyr Credit Union saves members £1.1 million in debt repayments


Merthyr Tydfil Borough Credit Union has revealed it saved more than 2,000 members around £1.1 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.

Delyth Shearing, General Manager for Merthyr Tydfil Borough 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 the Merthyr area.

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

On an average £700 loan repaid over a year, people borrowing with Merthyr Tydfil Borough Credit Union would pay a total of £843 over 12 months.

A typical lender, in this case Satsuma, offers the same loan over the same period the total amount repaid is £1394, £551 more than Merthyr Tydfil Borough Credit Union.

Dawn Bowden MS for Merthyr Tydfil said: “As a member of the credit union myself I know how valuable the service is. I would urge all constituents to join a credit union and to think how they can help families deal with financial management and avoiding the burden of personal debt”.

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, Merthyr Tydfil Borough Credit Union offers affordable, ethical loans and savings.

Delyth Shearing added: “Our members are not treated as a credit score and despite being turned away for a loan from other high street institutions, you 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 Merthyr Tydfil Borough Credit Union, go to www.mtbcu.org.uk

 

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