Pictured above: Seamus Grant, manager of ECU (left), and Howard Forster, chairman of ECU, with ECU member Anita Brady

A local financial co-operative has reached a major milestone - providing more than £1 million in low-cost loans to people in Erewash borough.

Erewash Credit Union, which is funded by the Coalfields Regeneration Trust, has helped more than 1,700 people since it was set up in 2007.

Credit unions, often called community banks as opposed to the major high street retail banks, are financial co-operatives owned and controlled by their members.

Money is lent at ethical interest rates. The income from this charge is put back into the credit union so that it can pay a dividend to savers and build up its reserves.

Howard Forster, chairman of Erewash Credit Union, said: "We have many local residents and workers who are using the Credit Union to save by cash, cheque, standing order and internet banking."

"Hundreds of people are using the Credit Union to pay in their Government benefits and some people are paying in their wages. This allows the Credit Union to provide small loans at affordable interest rates. For example, a £500 loan costs a total of £11 per week to repay over 51 weeks including an annual interest charge of £58, with no fees or penalties"  

Seamus Grant, manager of Erewash Credit Union, said: "Many of the loans we release are to workers who may be struggling to get credit from their bank or from other lenders.  They are fed up with paying up to 50% APR from loan companies or even up to 2300% APR from payday lenders or cheque-cashing centres.

"Other people on lower income and who may be receiving government benefit do not have access to mainstream banking. They are vulnerable to doorstep lenders or, even worse, loan sharks charging extortionate interest rates.

"We provide hundreds of Christmas loans and at this time of year we help hundreds of local families with holiday costs."

It is estimated that Erewash Credit Union has saved local people more than £1.5m in interest charges compared to what people could have paid to doorstep and other high interest loan providers. This money stays within the local economy and helps local businesses.