Credit unions will now be able to apply to two dedicated Scottish Government funds for support to continue their work in helping vulnerable families as they deal with the financial consequences of coronavirus.
The new credit union resilience loan fund and the third sector resilience fund will provide grants and loans totalling more than £20 million, available to be shared by more than 100 credit unions across the country.
Hundreds of Monklands residents are members of credit unions, such as the locally-based North Coatbridge, Kirklands, South Coatbridge and Chryston & District credit unions, while more belong to workplace-based schemes such as those for NHS, postal or taxi trade workers.
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Industry experts say that many credit union customers may struggle with loan repayments due to the financial impact of the Covid-19 pandemic, with dozens of industries facing a slump due to lockdown safety restrictions – and with credit unions working to provide affordable loans and therefore not making large profits, it poses a particular risk to the sector.
Now the credit union resilience fund, to be managed by Social Investment Scotland, will offer interest-free loans of £50,000 to £250,000 to credit unions, while the third sector fund will provide grants of £5000 to £100,000.
Robert Kelly, who is the chief executive of the Association of British Credit Unions trade body, welcomed the support from both the Scottish and UK governments.
He said: “We have hosted online conference sessions with credit unions from all over Britain to identify issues of emerging concern and ensure these are addressed and the business strengthened to deliver essential financial support to members and staff.
“There have been tremendous examples of partnership working; the voices of our credit union leaders are being channelled to government in a robust and effective way and the response has been hugely encouraging thus far.”
