INTERNATIONAL Credit Union Day took place last week. It is a day to reflect upon the credit union movement’s achievements and its future. The Welsh Government has a proud record of support for credit unions and has invested significant sums of money in the sector to support the most financially excluded members of society. Access to credit unions is a way of saving money and an alternative source of credit. Credit unions feature strongly in the Tackling Poverty Action Plan and form part of the Welsh Labour Government’s response to mitigating the impact of the UK Government’s Welfare Reform.

We see time and time again that UK Government decisions hit hardest against our poorest and most vulnerable families. In Wales, 16 per cent of the population, 400,000 people, have unsustainable debts. It is no wonder that there has been a dramatic increase in people taking out payday loans in Wales - from 2.6 per cent in 2010 to 18.3 per cent in 2013. These legal loan sharks target the poorest and most vulnerable. To tackle them, we need to promote alternative forms of borrowing, such as credit unions. Credit unions offer easier and cheaper ways of borrowing money and make the scandal of high interest loans avoidable.

It took a long time for the UK Government to agree that there was a problem with payday lenders and it’s important that they now keep the promises they’ve made. The promise of action came after a significant campaign by the Co-operative and Labour movements. Simply capping credit won’t work on its own. When considering how we promote access to fair sustainable sources of credit like credit unions we should think seriously about how we do that. We know that daytime TV shows have lots of advertising slots taken up by short term credit adverts. Credit unions need to be able to compete effectively in making quicker decisions and raising public awareness of the service they provide.

We also need a more strategic approach to providing a trusted brand with a wide ranging network to provide access to savings and credit. A tie in between the post office network and credit unions is one of the most obvious routes to achieving that. It is my view that there’s great potential for credit unions to work closely with housing associations and larger employers. For example one of the biggest consumer finance institutions in America is the Navy Federal with four million members of the US armed forces. This helps make the point that credit unions aren’t just for less well off families.

I want a sustainable Welsh credit union movement with clear social aims and a robust financial base that is supportive of each other. To attain this we must do all we can to help credit unions to continue to grow. Over 2,500 people have joined credit unions in Wales over the past year with the Cardiff and Vale Credit Union reaching over 7,000 members. If you would like to join you can do so by calling 02920 872373 or by visiting 21 Holton Road, Barry, CF63 4HA; Marland House, Cardiff, CF10 1EP; or http://www.cardiffcu.com/join-us.php.