Credit Unions see surge in consumer borrowers
Credit Unions have seen an influx of new members as consumers seek out affordable credit products amid the ongoing cost-of-living crisis.
A new analysis of lending statistics from digital lending marketplace Freedom Finance found that 1.93m Brits were members of a Credit Union by the end of the first quarter of 2022. This represents an increase of more than 22,000 from the first quarter of 2021.
Credit Unions are also loaning record amounts to their members, with borrowing reaching £1.79bn in the first quarter of this year – a 12 per cent year-on-year increase.
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David Hendry, chief marketing officer at Freedom Finance said that these figures demonstrate the need for affordable consumer credit options as the cost of living crisis continues.
“Credit Unions are playing an increasingly important role in the UK’s lending ecosystem,” Hendry said.
“This was accelerated by the withdrawal of many short-term credit providers from the market and demand is continuing to rise as the cost-of-living crisis makes borrowing more expensive and more necessary for many people. But Credit Unions can only be one part of the solution in this economic emergency.
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“A strong choice of reputable providers of short-term loans and other credit will be essential to helping people through the current cost crunch.
“Consumers must also ensure they are making the credit market work for them. This involves shopping around to get the best deal as well as using the latest technology both to ensure they are being matched with the most suitable products and so that they are only presented with credit offers they are eligible for.”
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