Ipswich credit union offering different way to save
PUBLISHED: 12:47 09 July 2019 | UPDATED: 12:47 09 July 2019
The Ipswich-based Eastern Savings and Loans Credit Union has received a £30,000 funding boost from Lloyds Bank.
The credit union, like others across the country provides loans for people who find it difficult getting cash from mainstream lenders, usually cheaper than credit cards, and doorstep lenders or pay day loans.
Lloyds Bank has pledged £1m to help credit unions across the country with half-a-million of it to lenders in East Anglia.
The ESLCU currently has £900,000 out on loan at the moment, mainly medium size.
Chief executive Chris Mole said: "It is typically very difficult for community credit unions to build the capital required by the Financial Conduct Authority for the level of assets we hold - this is particularly challenging for community credit unions like us as opposed to those that are employer-based. We're grateful for the funding from Lloyds Banking Group who really understand the challenges we're facing.
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"Since 2002 we have lent more than £9 million to people who would otherwise have had to use high-cost borrowing and estimate this has saved around £4 million in interest payments to doorstep lenders. Without the grant from Lloyds Banking Group we would not be able to grow our way to sustainability - the funding has given us a more certain future in which we can continue to grow."
The organisation has approximately 3,000 members, offering savings accounts and affordable loans to communities in Norfolk, Suffolk and Cambridgeshire.
As a saver, you can deposit money with the credit union.
Mr Mole explained: "We don't have interest paying accounts. We do pay a dividend where we can. A lot of people who deposit with us want to see some of their savings being used to help other people in the community,"
Typically loans could be from £500 to £700, paying 3% a month which was cheaper than most credit cards, high street lenders and a lot cheaper than an unsecured overdraft.
Lloyds Banking Group ambassador for the East Matt Hubbard, said: "We're committed to helping Britain prosper and supporting organisations like Eastern Savings and Loans so they can continue to support local residents in need of this vital support. Groups like this meet the needs of those who live in rural locations, many of whom would struggle to access a traditional credit union based in an urban area."