War on loan sharks launched
Credit unions launched an offensive today against rogue loan sharks preying on the vulnerable over the months in the run-up to Christmas.
The Irish League of Credit Unions (ILCU) warned that some lenders were legally charging almost 200% interest on borrowings while illegal lenders were charging much more.
It has rolled out its 'Keep The Wolves From The Door This Christmas' campaign to encourage people needing cash to talk to credit unions before taking out loans.
ILCU president Uel Adair said: “This is the time of year when people are most susceptible to the easy-money promises of moneylenders, who gloss over the frighteningly high costs involved.
“People are legally being charged up to 188.5% interest on such loans by legal moneylenders – and even worse by illegal moneylenders.”
Social and Family Affairs Minister Martin Cullen gave his backing to the campaign and urged those with money problems to seek out sound advice.
“People who are anxious about the issue of debt in the run-up to Christmas can get advice from their local Money Advice and Budgeting Service (MABS) office or contact their credit union for competitive loan advice,” he said.
The campaign follows research by University College Cork’s Centre for Co-Operative Studies, which shows high numbers of welfare claimants are in the grip of loan sharks.
The study revealed almost four out of every 10 people at post offices on welfare payment days were indebted to lenders.
Around eight out of 10 are either currently borrowing or have borrowed in the past from moneylenders, according to the survey.
“The less well-off and less financially-literate are most at risk and credit unions want people to know we’re on their side,” said Mr Adair.
Credit unions will issue Christmas “survival guides” with top tips on how to get the best out of Christmas shopping with a free budget planner.
“Credit unions were founded to provide affordable credit for anyone who needs it,” said Mr Adair.
“We are determined to effectively tackle these high-cost moneylenders who are preying on the most vulnerable among us.”
