New credit union to help people avoid loan sharks

A new credit union has loan sharks in its sights as it becomes the first of its kind to launch in Stoke-on-Trent in more than a decade.

Businessman James Adams and the city council have set up Potters' Bank to help people who have had an unexpected bill - such as car or fridge freezer repairs - but do not have the cash to pay it.

Mr Adams said that his work with a local food bank had shown him first hand how many people were struggling financially, and turning to pay day lenders or illegal loan sharks as a result.

Government figures show Stoke-on-Trent has the highest number of individual insolvency cases in the country. In 2024, there were 957 cases recorded in the local authority area.

Credit unions are mutually-owned, locally-based organisations designed to provide - unlike some lenders - low-cost loans for those who are less comfortably off.

In recent years, an increasing number of credit unions have gone bust, but Mr Adams argues they now fill a gap in the market.

Potters' Bank, which is part of Just Credit Union, already established over the border in Shropshire, is to offer employee savings schemes to help people who have ended up on the brink of financial crisis to build some resilience.

"We need to drive the loan sharks out of town," he said. "It's one thing to do it legally, through the legal process, but the other way to do it is to drive them out of business, and to provide a safe alternative."

The idea is that residents within the ST postcode can open savings, and loans accounts, with a "sensible" interest rate of just a few percent per year.

The people for whom it is designed are those who need money quickly to cover an emergency bill, perhaps involving a broken-down household item, but do not have a good credit rating, particularly if they have fallen foul of unscrupulous lenders previously.

The service will be available online, or through the city community lounges around the area.

Advice on where to go for those struggling with debt in Stoke-on-Trent can be found here.

BBC Action Line also offers information here.