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Credit union to take on pay day lenders

The premises on Birley Street in Blackpool.

The premises on Birley Street in Blackpool.

A bold step in a bid to take on loan sharks and pay day lenders has been agreed by Blackpool Council.

Members of the council’s executive committee unanimously agreed to purchase a small shop unit in the heart of the town’s financial centre on Birley Street, and loan it to the successful Blackpool, Wyre and Fylde Credit Union.

Terms to buy the property, close to banks including NatWest, Barclays, HSBC and Lloyds, as well as Skipton Building Society and two short term loan companies, the Cheque Centre and the Money Shop, have been set at close to £300,000, with a proposed rental agreement of £28,500 a year with the Credit Union to repay borrowing.

Coun leader Simon Blackburn said: “The credit union does and has been doing a good job, but what it has been lacking is a presence on the high street which is what we have been able to secure.

“It is in the heart of the financial district, near to banks and pay day lenders and helps people realise there is another option to help them if in debt.

“This will provide a holistic service. Whether someone owes £100 or £500, there is a reason why that has happened – have they got into trouble with their borrowing? Have they a problem with the agreement they are involved in? This is where the credit union can help.”

The deal to buy the former travel agents will allow the credit union to move from its current offices within Coastal Housing, also on Birley Street.

Credit unions were established to offer people who were turned down by the banks for loans, an alternative to being forced to borrow from pay day lenders, or even from loan sharks, who charge a huge rate of interest.

Speaking about the pay day lenders, Coun Blackburn added: “The Labour Party’s stance is to ban pay day lenders advertising on television during children’s programmes – I would just ban them.

“I believe they (interest levels) need to be capped to stop people struggling so much under levels of debt.”

“People need to know that there are other options available if they need a loan.

“It will offer great financial support for residents.”

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