The Welsh Government announces additional funding to strengthen credit unions, ensuring fair and accessible lending options for those in need.
As Christmas approaches, the Welsh Government is increasing its support for people who may be feeling the financial strain. An additional £408,719 is being provided to credit unions, offering a vital safety net for individuals and families who need access to fair and affordable lending during challenging times.
Affordable credit can be difficult to access, especially for people on lower incomes, as mainstream options are often costly or out of reach. Credit unions are there for them when unexpected expenses arise. Whether it’s for things like an urgent car repair or fixing a broken boiler, having access to a small, short-term loan from a credit union can mean the difference between handling a crisis and facing mounting debt.
By increasing the funding for the nine credit unions operating in all parts of Wales, the Welsh Government is making these services more accessible, so individuals and families can manage their finances without fear.
The Cabinet Secretary for Social Justice, Jane Hutt, said: “Life can be unpredictable, and people shouldn’t have to worry about where they can turn if an emergency arises. Christmas can be an especially costly time, and I would encourage those struggling with their finances, who may be at risk from high-interest doorstep lenders or loan sharks, to instead consider their local credit union, which can provide access to fair and affordable credit.
“This additional funding will strengthen the support credit unions offer in communities across Wales, helping people not only manage today but also build financial resilience for the future.”
Since 2022, the Welsh Government has committed £1.2 million to credit unions to expand their lending by offering new ‘starter’ loans and ‘credit builder’ loans, helping more than 3,600 people access affordable loans for the first time. This latest funding will further expand credit union services, providing valuable support for both new and returning members throughout the winter.
One of the credit unions who will benefit from the investment is Smart Money Cymru, which provides financial services to people in the Caerphilly, Blaenau Gwent and Newport areas.
Smart Money Cymru Chief Executive, Mark White said: “As community-based organisations, credit unions are there to help everybody, especially those struggling to access finance.
“The Welsh Government’s Loan Expansion Scheme is critical to helping credit unions like Smart Money Cymru Community Bank provide loans for people with poor credit profiles so they can rebuild their financial capability and start to grow a savings pot alongside their loan repayments. This is underpinned by our partnership with Blaenau Gwent County Council and the recent appointment of Councillor Jules Gardner as Credit Union Champion for the county with a brief to help tackle poverty and access to finance.”
The Welsh Government has also invested £637,000 in digital improvements for credit unions, ensuring they can offer online services comparable to those provided by banks. This means that people across Wales have flexible, easy access to financial support when they need it most.
