Pennsylvania Credit Union Association
Better Choice Saved Consumers $
THE RESULTS ARE IN …CREDIT UNION BETTER CHOICE SAVED PENNSYLVANIA CONSUMERS $619,000
HARRISBURG — The Pennsylvania Credit Union Association today released its initial results from the Credit Union Better Choice program, an alternative to payday lending developed in conjunction with the Pennsylvania State Treasury. Since the program’s launch in late October, 2006, 54 credit unions have agreed to offer Credit Union Better Choice loans, with additional participants continuing to sign on. Of these 54, 41 credit unions have made 1,661 loans, totaling $869,149.
“We are extremely proud of these early results,” said Jim McCormack, President/CEO, Pennsylvania Credit Union Association. “Through Pennsylvania’s credit unions, consumers, especially those living paycheck to paycheck, are able to access affordable small loans.”
A typical $500 payday loan costs consumers $15 for every $100 borrowed, or approximately $450 over 90 days. A $500 Credit Union Better Choice loan costs consumers approximately $42.50 for the same 90 days and at the end of the loan term, the consumer has $50 in a savings account, which allows them to develop a savings habit. In addition, the program builds upon this new wealth-building component by providing financial education to consumers in an effort to help them make better informed financial decisions.
Pennsylvania consumers saved an average of 80 cents in loan fees and costs for every dollar borrowed through a Credit Union Better Choice loan rather than through a typical loan from a payday lender. This translates into more than $619,000 that consumers kept in their own pockets by using credit unions that offer Credit Union Better Choice loans.
“As Treasurer, I am committed to strengthening fiscal literacy amongst Pennsylvanians and I believe that the Credit Union Better Choice program is an integral part of the process,” Treasurer Robin L. Wiessmann said. “I am very pleased by the success of this program in its first eight months and look forward to its continued growth and expansion, so that fewer and fewer Pennsylvania consumers suffer from the exorbitant fees and demanding repayment schedules enforced by many payday loans.”
“While the numbers for the first reporting period are indeed impressive, it is our hope that as more credit unions offer the Credit Union Better Choice program, the savings to consumers will continue to grow,” said McCormack.
To learn more about the Credit Union Better Choice program and a list of participants, visit www.PaCreditUnions.com.
Credit unions are financial cooperatives that provide affordable financial services to help their owner/members. The Harrisburg-based Pennsylvania Credit Union Association is a trade association that provides legislative, promotional, educational and operational support for more than 500 credit unions in Pennsylvania. These credit unions have assets in excess of $24 billion and serve nearly 3.5 million members. For additional information about credit unions or to find a credit union near you, visit www.ibelong.org
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