Cheque Centre accused of charging ‘extortionate rates’

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Green Party activists have accused the Cheque Centre in Carlisle of charging “wickedly extortionate” interest rates.

They demonstrated outside the lender’s branch in Devonshire Street on Saturday, urging customers to go to Carlisle and District Credit Union instead.

The Cheque Centre offers short-term loans to tide over borrowers until pay day. It accepts business from people with a poor credit history but charges are high. Someone borrowing £500 for a couple of weeks would pay back £602.41.

John Reardon, the Green candidate for Carlisle at this year’s General Election, argues that the Cheque Centre is taking advantage of vulnerable people.

He said: “They draw in people who need to borrow money and who feel like they have nowhere else they can go. Many people find they have no alternative but to be held to ransom by vultures such as these.

“We believe that the rates on offer at these sorts of places are disgusting and completely unacceptable.

“People are getting charged average annual percentage rates (APRs) of 827 per cent by increasingly visible, modern-day loan sharks like the Cheque Centre.

“Some APRs approach 2,500 per cent and they are perfectly legal.”

Mr Reardon advised would-be borrowers to visit the credit union in Lowther Street.

This is a non-profit making organisation that provides savings and loans.

Members are encouraged to save regularly and, once they have done so for eight weeks, can borrow twice the amount they have saved. Interest on loans is charged at 12.68 per cent APR.

Mr Reardon added: “Credit unions help to educate people about how to take charge of their finances.

“They encourage people to save and help them get control of their lives. People in Carlisle need to know there are alternatives to simply getting ripped off by these high street loan sharks.”

The Cheque Centre is part of a 140-strong chain based in Edinburgh.

The company declined to comment.

First published at 11:39, Monday, 06 December 2010
Published by http://www.newsandstar.co.uk

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