Cost of living crisis impacts thousands across South West, GWCU's 2022 Social Impact Report finds
Today, Great Western Credit Union (GWCU) has released findings from their 2022 Social Impact Report, exploring how the Credit Union has provided positive financial support to over 18,000 people across the South West. Just over half (52%) of surveyed borrowers said they were “greatly” or “extremely” impacted by the cost of living crisis, with 51% cutting spending on food shopping and other essentials and 42% reducing gas and electricity usage to cut costs. With a commitment to support members, over one in three GWCU borrowers benefitted from payment holidays or temporarily reduced payments.
The stark findings were set out in the responses from 912 borrowers and savers in January 2023 across the GWCU membership area which is comprised of Bristol, Bath, Gloucestershire, Wiltshire, Somerset and Dorset. During 2022, over 1,100 loans were provided to people in the bottom 20% of areas by levels of deprivation saving them over £500,000 in interest payments compared to high-cost lenders. Also, the Credit Union assisted 128 refugee families, from Afghanistan, Syria and Ukraine, through the UK Resettlement Scheme. 63% of saving members liked the idea that their money was helping others and 62% were in favour of it being a member-owned not-for-profit mutual.
Elsewhere, 2022 saw almost 2,000 new members join the Credit Union and a 9% growth in balances, with £13.8m in total assets at the end of the year. Loan members, who are more likely to choose GWCU to avoid higher-cost borrowing and the cycle of debt, tend to be from low-income households or from groups financially struggling. 38% earn under £18,000 a year, 16% are from ethnic minority backgrounds, around half (47%) are single parents and more than 83% are renting their home. Savers, meanwhile, are more often over 35 (38%) and more likely to own a home (53%) than borrowers. Across all of its lending, GWCU is helping members save over £2.5m per year in interest payments.
James Berry, CEO of Great Western Credit Union, said:
“Following the pandemic and the ongoing cost of living crisis, we have seen more people financially struggling than at any point in recent memory. This Social Impact Report provides insight into how we have helped tens of thousands of people across the region to become better off than they might otherwise have been, though we still see the need for growth in income to meet the pressure of increased costs which has hit so many of our members. Now, we’re planning to go even further with our current Bond Offer which will grow our services to ensure we’re supporting those most at risk of financial exclusion and anyone who would most benefit from access to affordable, fair and ethical credit.”
In April 2023, GWCU launched their Bond Offer with an initial target of £800,000 to help make purpose-driven finance more accessible*. With just 26 days left, the Credit Union has surpassed their initial target and is now heading towards a stretch target of £2m, inclusive of continued Fair4All Finance pound-for-pound match funding. The investment will allow GWCU to grow their offerings, including its digital platform and employer partnership scheme, Money@Work, which currently helps over 42,000 people across 38 organisations to access services directly from their payroll.
Find out more about the Bond Offer here.
*As capital invested is not protected by the Financial Services Compensation Scheme, any money invested is at risk.