Credit Unions Hampered By Legislation Delay » Central Government » 24dash.com

Legislation that will free up credit unions to enable them to provide affordable credit to larger numbers of members across a wider area and to lend to small businesses is stuck in the committee process in Parliament. The legislation would have swept away restrictive rules that prevent a credit union from serving a wider area than one London borough. It would have also allowed credit unions to make loans to small businesses.
Currently the completion of the legislation has slipped from April 2010 to July 2010. Given that there is a general election in June next year there are increasing fears that an incoming Government will not see credit union legislation as a high priority and it may get lost forever.
In the USA credit unions have played a massive role in mitigating the worst effects of the global recession and are likely to be freed up to provide sources of credit for small businesses which is exactly where it was thought the British credit union movement was headed.
In the area of West London where Credit Union Solutions is based Harrow Council has agreed to support the expansion of M for Money Credit Union as it develops from serving the whole of Hillingdon Borough to serving Harrow as well. Plans are also underway to extend the reach of Hounslow's credit union Thamesbank to include Richmond and Ealing Credit Union to serve Brent.
The tremendous benefit that access to a credit union will bring to these new communities has to be put on hold because the Government failed to seek a consensus with other parties before bringing forward legislation. This has echoes of the failed co-operative bill which was snookered by the Conservatives in the House of Lords recently.
Having whetted the appetite of credit unions and their supporters, registered social landlords, councils and a plethora of community groups there is disappointment at these continual delays. So where do we go from here, clearly unless there is an explicit commitment from all political parties that they are prepared to support this legislation and bring it forward with all speed, the ability for credit unions to provide assistance to those on the lowest incomes during the worst recession will be significantly constrained.