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Affordable Credit Joy Wetherill Welfare Rights Unit Manager

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Presentation on theme: "Affordable Credit Joy Wetherill Welfare Rights Unit Manager"— Presentation transcript:

1 Affordable Credit Joy Wetherill Welfare Rights Unit Manager
Chris Smyth Chief Executive Officer Leeds City Credit Union

2 Welfare Rights Unit Manager
Joy Wetherill Welfare Rights Unit Manager Leeds City Council

3 One-Stop Centres LCC has 15 One-Stop Centres across city
Centres deal with all aspects of Customer Service Decision made to remove cash counters Great opportunity to integrate credit union services with those of LCC Fulfilling the needs of mutual customers Working together to the benefit of the community

4 Partnership Working LCC helping credit union with issues around ID and providing appropriate documentation LCC promoting credit union services to clients who are un-banked and need an account for their benefits Post Office Card Account will NOT accept Local Housing Allowance

5 Partnership Working LCCU offers accounts for tenants through which they can pay their rent and other bills LCCU provides accounts for School Clothing Vouchers so people do not have to use cheque cashing shops Bond Loan available from LCCU (bond and first month’s rent) LCCU Handiloans for those unable to get credit elsewhere

6 Chief Executive Officer Leeds City Credit Union
Chris Smyth Chief Executive Officer Leeds City Credit Union

7 About LCCU Started in 1987 for employees of LCC
Expanded in 2001 to “Live or Work” Merged with 6 small church and community CUs Large as a Credit Union but small compared to Competitors Head Office and 10 branches across the city

8 Our Partnerships Positive partnership with LCC
Utilising former cash offices in One-Stop Centres Partnering with Customer Services to give holistic service DWP, LCC, ALMOs, Charities

9 Financial Inclusion Credit Union an important partner in LCC’s FI strategy and delivery Research recognised the need for local face-to-face services for low income consumers Also recognised the economic impact on the city’s prosperity of exclusion

10 Low Income Consumers Deserve decent, appropriate and affordable services just as much as those who are better off Use many services that are unsafe and/or expensive such as: Hamper schemes e.g. Farepak Coin meters e.g. Telebank Doorstep credit with interest rates as high as 800%

11 What do they need? A face-to-face, one-to-one friendly and approachable service Somewhere local to save a few pounds a week Simple products, easy to understand Help with basic budgeting and paying their bills Affordable credit

12 The Growth Fund £36m from the Financial Inclusion Task Force HM Treasury Administered by DWP through contracts with third sector lenders – CUS and CDFIs Provides the capital to make loans and the revenue to run the service Continues to 2011

13 Affordable Credit £300 from doorstep lender:
£15 a week for 32 weeks - pay back £480 (APR 399.7%) £300 from the credit union £10 week for 33 weeks – pay back £325 (APR 26.8%) Save £5 week - £165 extra to put away for a rainy day or spend

14 The Future Improved Credit Union Legislation Expected October
Changes to the Common Bond Wider Range of Products and Terms Ability to accept Funds from Bodies, e.g. clubs

15 Financial Inclusion Services (Yorkshire) Ltd
Eric Thompson Financial Inclusion Services (Yorkshire) Ltd

16 Affordable Credit in Sheffield
3 organisations – One Vision Financial Inclusion Services (Yorks) Ltd - a registered charity Moneyline Yorkshire (IPS) Ltd - an ethical loan company Sheffield Credit Union - a savings and loans co-operative

17 What do we provide Instant loans at affordable rates
Access to cheaper loans when a repayment history has been established Encouragement to save Payment of benefits direct Help with budgeting Financial Capability

18 What have we achieved Over 5000 instant loans per year
Totalling over £1.5m Saving over £2m on doorstep rates 10 Community Credit Unions merged Over 5000 adult members Over 2000 junior members £813k savings, £739k ‘normal’ loans 91% of clients from Closing the Gap areas

19 Sheffield Investment Bond
Open to individuals and organisations Championed by City Council’s CEO Guaranteed repayment in 5 years No interest Capital lent to Places for People Interest paid to Moneyline £750k raised, £110k given to Moneyline

20 Partnerships Local Strategic Partnership
Financial Inclusion Consortium Advice Consortium Debt Support Unit Sheffield City Council Sheffield Homes & RSLs University of Sheffield

21 Current developments Basic bank accounts Transaction banking
Pre paid debit card Holistic delivery of services Out reach provision Possible South Yorkshire Credit Union Financial Capability Work with offenders & their families

22 Thank you Any questions?

23 Contact Details Joy Wetherill Chris Smyth Eric Thompson
Tel: Chris Smyth Tel: Eric Thompson Tel: Mobile:

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