Illegal Money Lending Team steps up its pressure on loan sharks with partnerships with credit unions
21 Sep 18
Hosted by Birmingham City Council, the Illegal Money Lending Team is working with credit unions throughout the country to ensure that those that are vulnerable to loan sharks have a better option.
Through the Proceeds of Crime Act, money taken from convicted loan sharks will be used to work in partnership with credit unions in order to promote saving and keep people away from the clutches of illegal lenders.
The IMLT are partnering with a number of credit unions and with each has agreed to put £25 into any new accounts opened at a credit union (up to a maximum of 50 new accounts) that regularly saves with the credit union for three months.
The scheme has had a positive impact in the sector with several credit unions signing up to the new scheme. Most recently, Norwich Credit Union set up a partnership with IMLT offering the £25 offer to Broadland Housing tenants.
Jon Warne, President of Norwich Credit Union, said: "The aim of this is to encourage Broadland tenants to get into a regular savings habit. For many tenants needing quick cash, the only option is an online or high street lender or even a loan shark. Our local credit union provides a safe, low-cost alternative.”
Ivan Johnson, Group Improvement Business Advisor of Broadland Housing, says: “From Broadland’s point of view, we want to support our tenants to manage their money better, particularly with Universal Credit rolling out further across Norfolk this autumn. Rent arrears are a significant cost to housing associations. We’re also working with the credit union on other solutions to help tenants maintain their tenancy.”
Also promoting the new scheme is Barrow & District Credit Union. Their Chair, Simon Fell is determined to drive loan sharks out of its community, he said: “We are delighted to have formed this excellent partnership with the team who do so much to bring loan sharks to justice and prevent the damage they do to people’s lives. We hope we can successfully work together to stop any loan sharks working in our local area”.
Leaders of Winchester City Council has also pledged its support for credit unions, after admitting that the Council wasn’t aware of the scale of the issue with loan sharks in the city.
The Council have established a project group with Solent Credit Union to set up work alongside IMLT in cracking down on loan sharks in the city. MP for Winchester, Steve Brine said: "While I doubt few are mourning the demise of Wonga, the danger is unscrupulous loan sharks move into that space and it's the poorest in society whom they prey upon.
“Anything we can do to help people with financial advice and especially warnings about illegal money lending activity is helpful."