Lancashire's credit union reports busy year as coronavirus lockdowns take their toll

Despite the difficulties brought by the Covid pandemic, CLEVR Money issued 3,000 loans in the year to September 2020, to people from Blackpool, Fylde, Wyre, and Preston.

Bosses said the loans ranged from £200 to £15,000 and were used for everything from paying every day bills to home improvements and debt consolidation. As a credit union, loan interest rates are capped to ensure local people have access to fair and affordable credit.

CLEVR Money saw its membership grow over the year, from 5,332 to 5,654, and total savings grew 11 per cent from £4m, to £4.4m.

As loans are made from the savings pot, the £484,000 income generated was reinvested back into the business; this was up 44 per cent from £336,000 in 2019.

Bosses told the annual general meeting that the year’s success also allowed for a dividend of 0.5 per cent to be paid out to its shareholders; those members who have savings with the credit union. Around 40 per cent of members are employees of payroll partner organisations, companies which join up to provide their staff with the benefits of credit union membership.

Ron Bell OBE, president of the CLEVR Money board, paid tribute to the ‘magnificent’ efforts of the credit union staff to record an excellent set of results, despite having to close the Birley Street office to the public and stop face-to-face community meetings since March last year.

Speaking after the AGM, which was held by video call, he said: “The success of the last year, against the odds, is down to the flexibility, determination and dedication of the incredible team we have here at CLEVR Money.

“Recent difficulties and uncertainties have created an understandable reticence to borrow money on the one hand, and a greater need for cash on the other. As a credit union, our role is to cater to the needs of the community and respond to the realities of people’s lives, and be there to support whatever requirements they have.

“In 2020 we saw more lower value loans taken out by people needing cash for day-to-day expenses, and responded with the launch of the smaller child benefit loans for cash-strapped families.

“We also saw growth in the number and value of home improvement loans taken out by homeowners investing in their properties. And we noted a significant number of higher value loans for debt consolidation, which is a sensible solution for those struggling to manage multiple repayments at a time of uncertainty and job insecurity.”

Because the credit union only provides responsible loans, with no fees and hidden extras, it helps ensure members don’t rack up bad debt or get caught out by the sky-high interest rates of some online and high street lenders, or fall victim to the unethical practices of loan sharks and doorstep lenders.

Loans officers work with borrowers to help sort out their finances and set up savings accounts so some of their repayments go towards building a nest egg for the future; while making timely repayments also contributes to improving or rebuilding bad credit histories.

Looking ahead, the credit union has pledged to continue its support for the more financially vulnerable part of the community, but also wants to attract new members for whom an ethical banking alternative would be welcome.

Mr Bell said: “We’re working hard to spread the word that saving with the credit union is a risk-free way to invest in your community while ensuring your own financial security. You then have the option of borrowing with the credit union if the need arises, making the most of the affordable interest rates and transparent payment terms we offer to all our members.

“This is a scenario being appreciated by more and more people across the area and we’re seeing membership continue to grow particularly among workers who have options to go elsewhere but choose to be part of an ethical, responsible local organisation instead.

“This coming year we will bring on board some big name Payroll Partners who see the benefits of better financial security for their staff, and we are open to discussions with any businesses and organisations that want to support their employees in this way too.”