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28 September 2010, 06:00
Around 400 people in Milton Keynes are being helped to save money and apply for loans by the local Credit Union.
It's opening a new 'Collection Point' in Fishermead today, which will be the seventh one in the new city. The Collection Point is somewhere that people - who may not be able to get a loan from a bank - can go to find out more about the service on offer and sign up if they think it's the right option for them.
The rules of the Credit Union mean people need to save for three months before they can apply for a loan of up to three times their savings. It's hoped the service will help people out who need extra cash, and stop them going to high-risk lenders like loan sharks.
Terry Calvert - who's the Development Officer at Milton Keynes Credit Union - says although borrowers will still be charged interest, it's a lot less than illegal lenders would make them pay:
"The interest rates are very low. For small loans for example of up to £350 we charge 1% per month, which is 12.7% apr. For larger loans up to £5,000 it would be 1.5% a month, which is 19.6% apr. Bear in mind that compares to loan sharks who will often be charging thousands of percent in interest charges."
The Milton Keynes Credit Union is hoping to more than double the number of members it has by this time next year. And Mr Calvert says more people are looking to it as an option:
"The demand is very much growing. Of course over the last few years, confidence in banks, as a result of the credit crunch, and sometimes in things like Christmas Clubs has been very much affected. So we're hoping that people will recognise that we're providing a safe place where they can put their savings."
The existing Collection Points in Milton Keynes are in Stantonbury, Wolverton, Greenleys, The Lakes Estate and Bletchley.
Mr Calvert told us why Fishermead has been selected as the next location:
"Fishermead has a large transient population. There's people coming and going, a lot of people live in rented accomodation. There are people from various groups, ethnic groups, who often don't have access to mainstream financial service providers. So we're hoping by providing a collection point we're giving them a place where they can come to and they won't be financially excluded."
If you want to find out more about the Milton Keynes Credit Union, visit www.mkcreditunion.org.uk or call 01908 525086