Monday 30th June 2008
Credit unions are to be allowed to have an expanded role, according to new government legislation.
The reforms will mean that the community-based loans and savings groups will now be allowed to strike deals with local companies and housing associations - potentially increasing the number of people that can use them.
According to ministers, the so-called Common Bond - which limits the unions to the local community alone - will also be relaxed.
Credit unions are often used by people on low incomes who struggle to get credit with high street banks.
They are generally seen as preferable to so-called "loan shark" lenders, who often charge higher interest rates.
Economic secretary to the Treasury, Kitty Ussher, said: "Now more than ever, given families are feeling the pinch due to the tough situation in the international economy.
"We want to make it easier for families to access the affordable credit on their doorstep that is offered by credit unions, rather than having to turn to more expensive schemes, or at the extreme end, illegal loan sharks."
|
Loans
.gif)
.gif)
.gif)
