This week, a group of major High Street retailers announced they are planning to take on payday lenders by launching a credit union.
‘RetailCure’ has already got New Look and Next signed up, and will be chaired by John Lovering, a veteran retailer who has led buyouts of companies including Debenhams, Homebase and Somerfield.
The Credit Union will aim to offer an alternative to the interest rates charged on payday loans, and is expected to charge interest from roughly seven per cent to nearly 28 per cent, depending on the borrower’s credit history.
RetailCure has received start-up funding of £1million and will eventually be accessible to 4.8million people who work in retail or related sectors.
Lovering has said the motivation behind it was the need to provide “a source of cheap, reliable credit for our people.”
The group behind RetailCure say they believe it will eventually become Britain’s biggest credit union by undercutting payday loan firms.
It’s very reassuring to see different retailers coming together for a cause like this – ensuring borrowers are put first and protected against mounting debt and interest.
Credit Unions are controlled by its members and are run for its members and this is what’s important.
Our Payment Waiver, which is already live with Credit Unions across the UK, kicks in when borrowers face an unexpected period of loss of income. A business-to-business deal, the lender takes out the insurance and this comes at no extra cost to the borrower.
We want to ensure that borrowers are protected at all times, and feel as though they have a safety net to fall back on.