Cash confiscated from loan sharks will be used to reward people who save responsibly through a credit union in Dudley.
Castle & Crystal Credit Union, which is supported by Dudley Council, has launched an initiative to encourage residents to start saving this festive period while also making them aware of the dangers of getting involved with loan sharks.
The first 50 people to join the credit union - and save a minimum of £10 per month for the first three months - will get a £25 savings boost directly into their account.
The cash will come from money confiscated from convicted loan sharks at court under the Proceeds of Crime Act, with the initiative being run jointly with the England Illegal Money Lending Team (IMLT).
It is hoped the new incentive will encourage residents to build up savings for Christmas, and prevent more people from having to turn to a loan shark to borrow emergency cash.
This scheme is only available to residents living in the council wards of Upper Gornal & Woodsetton, Coseley, Kingswinford, Wall Heath and Wordsley.
The scheme is being backed by the Mayor of Dudley, Councillor Dave Tyler, who has opened an account and will donate the £25 to his three mayoral charities – Dudley Mind, the YMCA Black Country Group and the Dudley branch of the Alzheimer’s Society.
Councillor Peter Miller, cabinet member for health and wellbeing, said:
“Loan sharks often target low-income and desperate families; preying on struggling individuals and exploiting them for personal financial gain.
“We’re really pleased to have the support of the England Illegal Money Lending Team and are committed to ensuring people in need have an alternative to loan sharks and illegal lenders in their local community.
“Local people will greatly benefit from this scheme. It will help them to establish a healthy savings pattern, as well as benefit from the many credit union services available to members.”
Tony Quigley, head of service for the England Illegal Money Lending Team, said:
“We are pleased to be working with Castle & Crystal Credit Union to launch this new incentive, which will see loan sharks cash being put to good use, to sponsor new credit union accounts.
“Loan sharks can have a horrific impact on our communities and should never be used under any circumstances.”
A loan shark is someone who lends money without the correct authorisation from the Financial Conduct Authority (FCA).
An estimated 310,000 households nationally are borrowing from illegal money lenders, many of whom charge exorbitant rates of interest to trap people into a spiral of debt.
For more information on how to become a member of Castle & Crystal Credit Union, call 01384 815771 or pop in to branch to speak to an advisor at 25 New Street, Dudley, West Midlands, DY1 1LT. Alternatively, visit the website at www.castleandcrystal.co.uk for details on how to join the credit union.
ENDS
Notes to editors:
To report a loan shark:
Call the 24/7 confidential hotline 0300 555 2222
Text a report to 078600 22116
Visit the website www.stoploansharks.co.uk
E-mail reportaloanshark@stoploansharks.gov.uk
Private message us on www.facebook.com/stoploansharksproject