Lenders and loan sharks accused of using lockdown to target vulnerable communities in Leeds

Leeds Credit Union has warned residents across the region about an increase in high interest doorstep lenders who they claim are capitalising on COVID-19 uncertainty.

The credit union, which has more than 37,000 members, said it has seen a targeted campaign by these lenders in some of the city’s most deprived areas, with interest rates as high as 466 per cent APR.

Furthermore it has also expressed concerns that other illegal loan sharks are also capitalising on the situation, where the APR can be unlimited and sometimes repayments enforced by intimidation and threats of violence.

Social distancing requirements have meant that a number of the more well-known doorstep lenders have stopped their home visits and collections.

However Leeds Credit Union said there is evidence that they have instead stepped-up their targeting of some of Leeds’ most vulnerable people through postal advertisements and online marketing.

Chris Smyth, managing director of Leeds Credit Union, commented: “Leeds Credit Union already works closely with the Government's Illegal Money Lending team to stamp out loan sharks in the Leeds region, and our focus has always been on ensuring people across the city have access to flexible, affordable and fair lending.

“We are disappointed that some are using the COVID-19 pandemic to take advantage of those struggling financially but frankly, we aren’t surprised. It further underlines the importance of credit unions across the UK ensuring those that need it most have access to financial services that can help during this time of uncertainty.”

Leeds Credit Union, which was recently named as the region’s best lender, has reinforced its member services provision during lockdown, setting up additional contact numbers for members to get in touch.

A new mobile banking app has also been made available ahead of its official launch so members can access their accounts remotely.

Should members still need to visit a branch, Leeds City, Merrion House, Armley & Dewsbury Road branches are still open Tues, Thurs & Fri with social distancing and sanitation measures in place.