As low income consumers with poor credit find it more and more difficult to get loans, a credit union may provide the answer and get help to those who need it, according to the Association of British Credit Unions Ltd (ABCUL).
Credit unions have a long history of lending to people with lower incomes. Their application procedures are designed to fit with members' needs, including literacy problems.
Repayments are set at an affordable level, suiting household budgeting needs. Many credit unions are breaking the link between loans and savings, enabling people to access credit at affordable prices.
Nearly fifty credit unions offer Benefit Direct accounts, which allow members to repay their loans directly from their benefit payments they collect at their local credit union. Members can even start saving into these new accounts.
ABCUL chief executive Mark Lyonette said: "With the increasing popularity of benefit direct accounts and the forthcoming launch of our basic bank accounts, credit unions' impact on financial inclusion will continue to rise."To read more about bad credit loans, click here.
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