Church credit union scheme launched

Updated: 

PA

A new national network aimed at offering an alternative to pay day lenders has been launched by the former chief City regulator.

Sir Hector Sants, former chief executive of the Financial Services Authority, said the Church Credit Champions Network would "transform" the lives of many people.

The scheme, aimed at promoting community based financial services, is to be piloted in the Southwark, Liverpool and London Church of England dioceses.

Sir Hector said: "This is a grass roots initiative that will only succeed with the enthusiasm and engagement of the local church. Central to this engagement will be the flexibility to adapt to local circumstances and the willingness to learn from all as we go along."

He added: "'I am confident that the successful implementation of the Church Credit Champions Network will equip churches to be even more relevant to their local communities, and transform the lives of the many
people we hope will be served as a result."

The Bishop of Stepney, the Rt Rev Adrian Newman said: "We are aiming to train and resource churches in London and Liverpool to become key partners of their local credit union.

"This is a much-needed step in building the profile and strength of credit unions - which are a vital, ethical source of credit for our local communities."

The network has been launched after the Archbishop of Canterbury, the Most Rev Justin Welby, said last year that he wanted to drive pay day lenders out of business through the creation of credit unions.

The pay day lenders have argued that their loans are intended to be repaid over a short term and fill a gap left by the High Street banks.

But Archbishop Welby has expressed concern that these loans are tempting people into a spiral of debt.

He said he planned to expand the reach of credit unions as part of a long-term campaign to boost competition in the banking sector.

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