MSPs highlight role of credit unions
01 Feb 13
On Wednesday, the Scottish Parliament debated the cost of living for people across Scotland, with a particular focus on the dangers of using payday lenders.
MSPs from all five parties supported motions highlighting the part credit unions can play in providing an alternative, affordable source of credit.
Leading the debate, Kezia Dugdale MSP (Scottish Labour & Co-operative, Lothian) called for more support for credit unions, especially with product development and lending capacity, as credit unions could provide “great, credible, accessible and—crucially—affordable alternatives” to high cost credit, charging no more than a maximum 26.8% APR as opposed to up to 4,214% APR from the leading payday lender.
Responding for the Scottish Government, Energy, Enterprise and Tourism Minister Fergus Ewing MSP also praised credit unions for their ethos of promoting responsible budgeting and financial management, noting that credit unions “have behaved more sensibly and prudently than many fancy banking organisations throughout the world.”
The final motion, passed with the support of 100 MSPs – including the First Minister Rt Hon Alex Salmond MSP and Scottish Labour Leader Johann Lamont MSP – recognises “the important role that credit unions can play in providing a viable alternative” to payday lenders.
After the debate, ABCUL Scotland Policy and Relations Manager Frank McKillop said: “Credit unions can help build better financial capability and make responsible loans with affordable repayments at an ethical rate of interest. We welcome the unanimous recognition of the role credit unions can play from MSPs of all parties, and we look forward to the Scottish Parliament’s continued support for the credit union movement.”