Credit Unions warn of payday loan companies

Bridgwater Mercury: Credit Unions warn of payday loan companies Credit Unions warn of payday loan companies

PAYDAY loan companies are attempting to pass themselves off as credit unions, it has been claimed.

Paul Urch, treasurer of Somerset Savings and Loans credit union, says some discredited companies are now employing even sharper tactics in a bid to latch on to unsuspecting customers.

He said: “I was disturbed to discover that through a simple internet search for ‘credit unions’ you are now greeted by paid adverts offering ‘Credit Union’ loans. I have checked out most of these and find that none are owned or operated by Credit Unions.”

Credit Unions are not-for-profit lenders judging applications on affordability.

Mr Urch said he had tried one of the advertisement links to check whether the site was a bona fide credit union.

He added: “I have received 22 emails from a variety of credit companies offering me the £2,000 I applied for and ten text messages asking me to contact one loan company or the other. The only encouraging aspect was that I actually received one email rejecting my application!

Savings with Somerset Savings and Loans are covered by the Financial Services compensation scheme up to £85,000.

Comments (1)

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9:48am Thu 29 May 14

RhiannonCFA says...

This story, and the recent articles in the Bristol Post and Western Daily Press which also stemmed from Mr Urch's comments, are highly misleading. The fact is that payday lenders are not passing themselves off as credit unions. The results of a Google search for credit unions throws up a link to a lead generator – not a lender – and this appears in the paid ad section. Through targeted advertising via cookies on the searcher's computer and brand term bidding, both of which are controlled by Google, every search will see different results. One thing is clear though. Reputable payday lenders are not at fault here. In the interest of transparency, the CFA is the principal trade association for short-term lenders. We aren't here to defend bad practice in our industry but nor can we let articles that are misleading or inaccurate pass without comment.
This story, and the recent articles in the Bristol Post and Western Daily Press which also stemmed from Mr Urch's comments, are highly misleading. The fact is that payday lenders are not passing themselves off as credit unions. The results of a Google search for credit unions throws up a link to a lead generator – not a lender – and this appears in the paid ad section. Through targeted advertising via cookies on the searcher's computer and brand term bidding, both of which are controlled by Google, every search will see different results. One thing is clear though. Reputable payday lenders are not at fault here. In the interest of transparency, the CFA is the principal trade association for short-term lenders. We aren't here to defend bad practice in our industry but nor can we let articles that are misleading or inaccurate pass without comment. RhiannonCFA
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