Credit union bites back at loan sharks with new incentive scheme

Money confiscated from convicted loan sharks is being used to back new credit union accounts in Somerset as part of a new incentive scheme launched this week.

The England Illegal Money Lending Team (IMLT) has teamed up with Somerset Community Credit Union (SCCU) to launch an incentive to encourage residents to build up savings so they never have to turn to loan sharks in a financial emergency.

The joint initiative will see the team use proceeds of crime money, confiscated from convicted loan sharks, to sponsor new credit union accounts.

The first 50 people to join SCCU before March 2022 and save £10 per month for three consecutive months will qualify for a savings boost of £25.

Cllr Leigh Redman, Mayor of Bridgwater attended the launch event with IMLT national mascot ‘Sid the Shark’ at Victoria Park Community Centre on Wednesday, 15^th September.

Elizabeth Marsh of Somerset Community Credit Union said: “We provide savings and loans services to more than 1000 members across Somerset, and sadly we’ve come across people who have fallen into the clutches of loan sharks. 

“Many loan sharks will resort to bullying tactics, such as intimidation, threats and even violence to enforce repayment, and often won’t set an interest figure or have any form of paperwork. 

“We want to make loan sharks history in our county, so we’re delighted to offer this incentive to show people there is a better, safer and more affordable way to manage their money.”

Loan sharks are unregulated criminals, often giving cash loans without any paperwork and charging extortionate interest rates. They may offer what appears to be a quick-fix small loan but in the long term, any money borrowed will come at a very high price and may lead to violence, threats and intimidation.

These are some of the warning signs to watch out for that a lender is acting illegally:

• Giving you no paperwork or agreement on a loan 
• Refusing to give you information about the loan 
• Keeping items until the debt is paid, such as your passport or bank card
• Taking things from you if you don’t pay on time 
• Adding more interest or charges so the debt never goes down 
• Using intimidation or violence if you don’t pay

Tony Quigley, Head of the IMLT said: “Loan sharks operate across all communities. These unscrupulous individuals target the vulnerable and make money persecuting those who can least afford it.

“As a society we need to protect those at risk and ensure illegal money lending is a thing of the past. Credit unions are a huge part of the solution and by offering affordable, responsible loans they give people who need a little extra help from time to time, a safe and reliable option.

“We encourage residents to take advantage of this new incentive and save regularly with their local credit union, where they will also be able to access low-cost loans and a wide range of financial products.”  

For more information about membership and savings, please visit the Somerset Community Credit Union website www.somersetccu.uk or call the team on 01278 447100.

If you have been affected by loan sharks and require specialist support, please call the Stop Loan Sharks 24 Hour Helpline on 0300 555 2222 contact us via Live Chat, available 9am to 5pm, Monday to Friday. Just click the chat icon in the bottom right hand corner of the screen to talk only with our expert support team.