Funding for credit unions to set up schemes in schools
Children will be encouraged to manage their money from an early age through a new Junior Savers Scheme. Credit unions will be able to bid for a share of £300,000 Scottish Government funding to develop savers schemes in schools across the country next year. Continue reading Minister meets school savers in Stockbridge
North Edinburgh Credit Union AGM TONIGHT!
North Edinburgh Credit Union’s annual general meeting will be held
on Thursday 12 March at 6.30pm
at NECU Office, 63 Wardieburn Drive
The Credit Union has been around since June 1986 and is getting a bit ‘tired’ – especially the current volunteers! If you want your Credit Union to continue we need volunteers who are younger and have fresh ideas to take the Credit Union forward.
We have at last updated our Rule Book and extended our Common Bond to taek in Live and/or Work in the designated map area, which has also been extended to Silverknowes, Craigleith, part of Comely Bank, Fettes, Ferry Road to Newhaven Road and down to Newhaven harbour.
The current committee has been talking to a new group called Water of Leith Credit Union (Community Bank) who have lots of new ideas (including technology) which would help take this Credit Union forward. Some of their committee will attend our AGM to give a short presentation and answer questions.
Why not join us to hear their views?
North Edinburgh Credit Union
Campaign to highlight money advice service launched
A campaign to signpost people struggling with debt to the full range of money advice services available has been launched by the Scottish Government.
The Lighten the Load campaign raises awareness of the Scotland’s Financial Health Service website, which provides links to bodies offering information and advice on debt, managing money, housing, homelessness and ethical lending, encouraging those with money worries to take the first steps towards regaining control of their finances.
The campaign, which is aimed at people from all walks of life in Scotland seeking credible answers to issues connected with debt and money, includes a new television advertisement themed around how everyday tasks become more difficult when people are burdened with debt.
The Scottish Financial Health Service website was created by the Accountant in Bankruptcy and was launched by Business Minister Fergus Ewing in December.
Mr Ewing said: “January can be a difficult time for families when the bills associated with the festive period start to come in, but it can also be a time when people turn their attention to their finances for the year ahead.
“This campaign is intended to encourage people to access the full range of financial advice services available to help them manage their money in the months ahead.
“Since it was launched by Accountant in Bankruptcy last month, Scotland’s Financial Health Service has already been making a difference to people seeking guidance on how to prevent worries about money turning into a crisis.
“Launching this campaign will empower even more people to lighten their own money load and take back control of their finances.”
As well as providing access to debt support services, the Scotland’s Financial Health Service website also signposts users to practical credit and protection solutions offered by credit unions across Scotland.
Frank McKillop, Policy Manager at ABCUL Scotland (the Association of British Credit Unions Limited), said: “Helping people get – and stay – on top of their finances is a key part of what credit unions are all about.
“We welcome this campaign, and hope that through Scotland’s Financial Health Service, more people from all walks of life will turn to credit unions and take a responsible approach to saving, borrowing and budgeting.”
Scotland’s Financial Health Service website is available from today at:
Credit Unions play key role in tackling debt
A new Financial Health Service offering a one-stop-shop for money advice services has been launched by Business Minister Fergus Ewing. Scotland’s Financial Health Service website provides links to a range of organisations offering information and advice on debt, managing money, housing, homelessness and ethical lending.
A key part of the new website is a Financial Education module which aims to help people to manage their money to stop any future problems.
The website also allows users to search for their local credit unions and find out about the products offered by them, and to search for approved money advisers.
A new law, the Bankruptcy and Debt Advice (Scotland) Act, which comes into force in April 2015, ensures appropriate debt relief and management and includes mandatory provision of money advice.
Launching Scotland’s Financial Health Service in Edinburgh yesterday Mr Ewing said:
“It is important that we take action to help those people in Scotland who are struggling under the burden of debt. We have developed Scotland’s Financial Health Service because we must ensure that people who need to access debt and budgeting advice, do so easily with credible sources.
“Last year, the Accountant in Bankruptcy’s ‘12 Days of Debtmas’ campaign targeted people who may get into financial trouble over the festive period by using high interest, short-term credit.
“During the six months between October 2013 and March 2014 – during which time the ‘12 days of Debtmas’ and ‘Helping Hand with debt’ campaigns ran – 14,307 new members joined credit unions in Scotland. This is a 4.2 per cent increase in total membership.
“People across Scotland can join credit unions – all sorts of people from all walks of life use credit unions to save and borrow responsibly, and the most successful attract a diverse membership.”
Welcoming the launch Paul Walsh, CEO of CUNA Mutual said: “With the ever widening protection gap continuing to spread – leaving 86 per cent of Scottish residents in trouble if their income was lost – it is vital that the right support is provided to those who become financially vulnerable.
Initiatives like this government website, supporting those shouldering the burden of debt, are imperative alongside the practical credit and protection solutions offered by credit unions throughout Scotland. “The credit union movement in Scotland both funds and protects thousands of Scottish residents and has become a solid part of the Scottish financial community.”
ABCUL Scotland Policy Manager Frank McKillop said: “Since Scotland’s first credit union was founded in 1970, generations of volunteers, directors and staff have been focused on helping people in their communities and workplaces to get on top of – and stay in control of – their finances.
“By encouraging a responsible approach to saving, borrowing and budgeting, Scotland’s credit unions are well placed to play their part in building the nation’s financial health.”
The Westminster government is to introduce legislation to cap the cost of payday loans. In a move that’s likely to be welcomed by campaigners, the Treasury says there is “growing evidence” in support of the move.
The cap will be included in the Banking Reform Bill, which is currently going through Parliament, and the level of the cap will be decided by the new regulator the Financial Conduct Authority (FCA).
Chancellor George Osborne told the BBC there will be controls on charges – things like arrangement and penalty fees – as well as on interest rates. “It will not just be an interest rate cap, you’ve got to cap the overall cost of credit,” he said.
Although the level of the cap is yet to be determined, the announcement will be welcomed by opposition and campaign groups who have been urging the government to take action against some pay-day lenders’ practices: eye-watering interest rates and hidden charges which hit the poorest hardest and drive desperate people deeper into debt.
Just last week, Citizens Advice Scotland claimed that many payday lenders in Scotland are breaking the promises they made last year to clean up their act. According to CAS research, lenders continued to break ‘most of the pledges in their own code.’
The main points were:
CAS Chief Executive Margaret Lynch said: “When the payday lenders published this voluntary code last year we made clear we would be watching them like a hawk to make sure they kept to their word. Because there’s no point making promises if you don’t live up to them.
“Our survey results – together with the experience of other clients we see every day in the CAB – show very clearly that this Code of Conduct Is being ignored repeatedly.
“Across Scotland, CAB advisers are currently seeing over 100 cases every week of people who are in crisis debt to a payday lender. That’s a third higher than this time last year. Our evidence is that many lenders are operating in ways that result in people getting into debts they can’t handle.
“So the Payday Lenders have had their chance to clean up the industry, and they have failed. It’s time now for the regulators to step in and do it properly.”
People across Scotland are being urged to consider credit unions as an ethical and affordable alternative to payday loans. The Scottish Government’s ‘12 Days of Debtmas’ campaign is aimed at people who may get into financial trouble in the run-up to Christmas by using high interest, short-term credit.
Over 350,000 people across Scotland are members of credit unions; co-operatives that are owned and managed by the people who use them. Members are encouraged to save monthly, even if it is only small sums. They can borrow at competitively priced rates and in some cases, in a short timescale.
First Minister Alex Salmond recently announced plans to protect consumers pledging payday lenders would be subject to tougher regulation in an independent Scotland.
Speaking at Grampian Credit Union, Enterprise Minister Fergus Ewing said:
“The Scottish Government is very concerned about the growth of payday lending and the impact that high interest borrowing, especially in the run up to Christmas, has on people in Scotland.
“This campaign raises awareness of credit unions and also promotes their affordable lending solutions to people in the lead up to Christmas, and after the festive period, when bills start to arrive.
“People across Scotland can join credit unions and not just for hard pressed communities – all sorts of people could use credit unions to save and to take out loans at manageable interest rates.
“You can join a credit union and in some cases, borrow money in a short timescale. It costs significantly less to borrow money from a credit union than taking out a payday loan and you receive much more support in managing your finances.
“I welcome the changes that have been made at UK level but I continue to press for firmer action. To protect consumers, payday lenders would be subject to tougher regulation in an independent Scotland.”
Scotland’s main faith groups, consumer groups and debt charities have all welcomed the campaign.
Margaret Lynch, Chief Executive of Citizens Advice Scotland said: “Payday Loans are one of the main issues that we see today in the CAB service. Across Scotland our advisers are currently seeing over 100 cases every week of people who are having problems with a payday loan. That’s an increase of a third in such cases since this time last year.
“We back the Government’s statement today, and are keen to spread the message to consumers about the dangers of high-interest loans. To people who might be considering taking out a loan we say: Be very careful about what lender you use. Payday loans might seem convenient today, but they can lead you deep into debt.
“Shop around for a better deal. There are other lenders, like Credit Unions, with loans that are easier to repay. In particular, if you are already in debt to a payday lender, avoid roll-over loans with the same lender.”
Frank McKillop, Policy & Relations Manager (Scotland), Association of British Credit Unions Limited said: “People across Scotland from all walks of life join credit unions to take control of their finances – saving for future expenses, borrowing responsibly at affordable rates, and accessing other financial products from ethical local providers.
“We hope this campaign will attract many more people to join a credit union and take a responsible approach to their finances, rather than being drawn to the sort of short term fix which often makes money problems worse.”
John Deighan, Catholic Parliamentary Officer said: “The effects of high interest loans on the poorest in society is devastating. Usury has been condemned throughout the ages for oppressing the poor through unreasonable and irresponsible lending.
“Yet our society is effectively permitting the practise supported by slick television and media commercials. It is right that political action seeks to highlight alternatives and ensure reasonable access to credit without the crippling interest rates that so many are enduring.”
The ‘12 Days of Debtmas’ radio and online campaign begins today.
You can find your nearest Credit Union by checking the ‘credit union finder’ at the following link: www.12daysofdebtmas.com
A couple of news items caught my attention last week. One was about the number of empty shops on high streets and in shopping centres across the country. The economy is still in the doldrums, and people are just not spending. Apparently one in five retail units currently lies empty. It’s not all doom and gloom, however – recessions and depressions bring business opportunities for some, and it’s boom time for pawnbrokers and ‘pay-day loan’ companies. It seems these enterprises are springing up all over the place – perhaps our only growth industry, even.
The other piece of news was the Westminster government’s crackdown on these very same companies – the top fifty have been ordered to get their house in order or face closure by the summer.
The Office of Fair Trading said that the £2 billion a year industry has got to clean up it’s act. OFT Chief Executive Clive Maxwell said: “We have found fundamental problems with the way the payday market works and widespread breaches of the law and regulations, causing misery and hardship for many borrowers”.
He added: “Payday lenders are earning up to half their revenue not from ‘one-off’ loans, but from rolled-over or refinanced deals, where unexpected costs can rapidly mount up. This irresponsible lending is not confined to a few rogue payday lenders – it’s a problem across the sector. If we do not see rapid, significant improvements by the fifty lenders we inspected, they risk their licences being removed.”
For most, payday loans are something to avoid – everyone knows about the eye-watering interest rates being charged. Pay day loan companies often only quote what a loan will cost you in pounds and pennies, but take out a typical payday loan and you could find yourself being charged at a rate of anything between 1,600 % and 2,700%.
And that’s all the more shocking at a time when personal loans from ordinary high street banks have never been cheaper, available for as little as 9% APR – assuming, of course, that you can get one. But for those that can’t – an increasing number of desperate people –payday loans are the only option, the last resort. And these same people then often find themselves mired in a nightmare spiral of ever-growing debt, sometimes facing the distinct possibility of losing their homes – local advice organisation like Granton Information Centre have reported a significant increase of people tackling serious debt issues.
So a crackdown on payday loan companies – however welcome – won’t help the thousands of people who are currently tied in to horrific loan arrangements. What can they do?
Firstly, seek independent advice, from an organisation like Granton Information Centre or your local Citizens Advice Bureau. DON’T take on another loan to cover your last one.
And think about going a Credit Union. Credit Unions were set up to help people just like you, offering mutual and ethical savings and affordable loans. Credit Unions are regulated ‘Not for Profit’, Member-Owned (mutual), Financial Service Co-operatives and can best be described as organisations that encourage their members to save together and lend to each other responsibly. This allows these members the opportunity to gain greater control over their finances.
Community-based, community owned and community operated, two Credit Unions operate in the local area – North Edinburgh Credit Union in Wardieburn Drive and Capital Credit Union in Stockbridge.
Association of British Credit Unions Ltd (ABCUL) Chief Executive Mark Lyonette said last week: “Given the anecdotal evidence we hear from credit unions that help payday loan customers pick up the pieces, we are not surprised that the OFT has found evidence of such large scale poor practice in the payday lending industry.
“Loans repayable in full within a few weeks are rarely appropriate or affordable because this only stores up problems for later. If a loan is needed, spreading repayments over a few months will usually make more sense. Credit unions are a great source of affordable credit and many have helped people get out of the expensive habit of using payday loans. They can also help people to look at their finances and get into a savings habit so that they do not have to rely on a short-term loan next time they are short of money.”
North Edinburgh Credit Union’s Annual General Meeting
will be held on Thursday 21 March at 6pm at the NECU office on Wardieburn Drive.
Go along and support your local credit union
