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Love Kingston appeal: Credit union putting loan sharks out of business
Officially launched in October, the Love Kingston project is organised by Kingston Voluntary Action (KVA), and has selected five charities to support its aim of providing pathways out of poverty.
The five charities are youth project Oxygen, Kingston Foodbank, women’s refuge Hestia, credit union Kingston Savers and Kingston Churches Action on Homelessness.
Over the coming weeks, we will be profiling each of the five charities being supported by Love Kingston.
This week, we look at Kingston Savers: Short of cash and need a loan?
Rarely a day goes by without most people hearing or reading these sort of offers.
In this age of belt-tightening and cutbacks, the promise of quick-fix payday loans is everywhere – on television, radio, billboards, newspapers and the internet.
Michael Green, Kingston SaversWe do not apologise for the fact that if we can make the numbers of legal loan sharks and payday loan companies in Kingston decline, we are doing our job
Many people, in a rush to pay off bills, credit cards, rent or mortgages, have been tempted by the offer of instant cash as a way of solving short-term money problems.
But by doing so, some have only exacerbated their situation – the lenders’ crippling interest rates leaving them in even greater debt than before.
And that is why Michael Green, from Kingston Savers, is keen to offer an alternative.
Kingston Savers was set up in April 2012 after credit union SurreySave, itself established only months previously, was granted permission by the Financial Services Authority (FSA) to extend its remit into the borough.
Like all credit unions, it offers its members affordable loans and a competitive rate of interest on savings, as well as free life insurance and loan protection cover.
Unlike banks and payday lenders, it does not impose penalties on those who pay their loan back early, and all members’ deposits are protected under the FSA’s Compensation Scheme.
Mr Green has spent years trying to set up a credit union in Kingston, and now that it is here, its importance cannot be overstated.
He said: “Kingston is not 100 per cent affluent with no issues. There are serious issues around poverty.
“The last five years has really motivated people to make sure we don’t miss out on credit unions.
“Kingston Voluntary Action has wanted to add a credit union to Kingston’s voluntary sector for 20 years, but the process has been difficult.
“It was only possible through a combination of legislative change, the help of Kingston Council, the financial and economic situation and volunteers, particularly Max Freedman, Nick Kilby, Rob Lee and Adrian McKeon.”
Kingston Savers has secured enough funding from Kingston Council for the next three years, but is keen to attract more members in order to continue helping those in need of financial help.
Mr Green said: “If they are in need and can show they can sustain their repayments on a loan from the credit union, it is clearly a much more sustainable product for them than a payday loan or doorstep lending.
“There is enough research and anecdotal evidence to suggest pay day loans and doorstep lending is not a panacea. We do not apologise for the fact that if we can make the numbers of legal loan sharks and payday loan companies in Kingston decline we are doing our job.”
So far, Kingston Savers members include Kingston and Surbiton MP Edward Davey and Richmond and Kingston MP Zac Goldsmith.
Mr Green said: “We need people who are happy to save and want to get more in tune with the habit of saving, for philosophical and philanthropic reasons. And those are as good a reasons as any.”
l For more information on Kingston Savers, see visit surreysave.co.uk or email firstname.lastname@example.org.