COMMUNITY savings and loans groups in East Lancashire have launched a major challenge to high street banks.

A week-long campaign by credit unions aims to make people aware of the benefits of the self-supporting local organisations and attract thousands of new members.

Thousands of leaflets are being distributed throughout the county in a campaign co-ordinated by Lancashire Co-operative Development Agency.

With loans to members at fixed low interest rates, credit unions hope to attract small to medium savers at a time when building societies are losing their mutual status and becoming less attractive to such savers.

The advertisements emphasise the co-operative nature of the unions, raising money from within the community and lending it only to people within that community.

Burnley has three credit unions, others have been developed in Rossendale and the area's largest and oldest is based in Nelson. Under the slogan "People Helping People" the campaign describes credit unions as providing a banking service and cementing community ties.

Barbara Sanders, treasurer of Brunlea Community Credit Union in Burnley, said: "Credit Unions provide a valuable service which is friendly, helpful and cheap.

"We are a non-profit making bank and all the staff are volunteers and any financial surplus goes straight to our savers."

This has enabled some unions like the Nelson Community Credit Union to offer as much as five per cent dividends on all savings some years, up to 10 per cent on children's savings and offer loans fixed at 12.6 per cent APR.

Said Barbara: "It is all about people coming together to help each other in a spirit of co-operation. We want to help foster a sense of community."

There are 18 credit unions in Lancashire, with another three about to be formed.

Nelson Community Credit Union's annual meeting takes place at the St John Southworth Centre, Vaughan Street, Nelson, at 8pm tomorrow night.

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