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Welsh Government
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Minister challenges credit union movement to grow through new £1.7 million pound funding package
Communities and Tackling Poverty Minister Jeff Cuthbert has revealed almost £1.7 million for beyond March 2014 to help vulnerable consumers and put credit unions on a sustainable footing so they can survive without public funding. The new money, which covers the next three financial years, builds on the significant financial support from the Welsh Government over a number of years.
Ministers have worked closely with credit unions to provide financial products to people excluded from mainstream financial products, setting a target of 7,500. This has actually been exceeded with more than 34,000 people being reached.
To build on this, £200,000 of the new funding will be allocated depending on the level of activity credit unions have carried out with those who are financially excluded. Those that have more financially excluded members will receive a greater share of the £200,000. The overall funding will be reduced over the next three financial years up until March 2017.
The Welsh Government has a target of getting 143,000 people members of credit unions in Wales by 2020, the equivalent of six per cent of the population. There are currently 72,000 members.
Credit unions are not-for-profit mutual financial co-operatives that take deposits and give loans to members and provide an alternative to traditional banks and high-rate loan providers.
Jeff Cuthbert said:
“We want to make sure credit unions go from strength to strength and become a permanent sight on high streets across Wales. They are a real, community focussed alternative to traditional banks and payday lenders.
“This new funding builds on the financial support we have provided to the movement over a number of years so they can continue to encourage savings, offer accessible loans and work in our most vulnerable communities. We are working together to continue to attract more members and increase the loans and products they offer to all walks of life.
“However, eventually credit unions have to be able to stand on their own as independent financial institutions. That is why our latest support is aimed at creating a financially sustainable credit union network with a strong membership base that supports the work they do and continue to help those communities who need it the most.”
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