15 December 2006
The Scottish Executive yesterday agreed to underwrite loans for Farepak sufferers which would see them get up to £400 in an unsecured loan to help finance the Christmas period.
Deputy enterprise minister Allan Wilson told the Glasgow Daily Record that the deal would allow credit unions to lend to non-members, making it easier for consumers affected by the saving-scheme collapse to receive extra funding for the festive period.
He said: "The sense of injustice experienced by Farepak customers has struck a chord right across the country. These people followed the rules and saved for a one-off expense but still lost out.
"I applaud the individuals and organisations who have donated their time and money to the campaign for justice for Farepak customers.
"Credit unions are well established across Scotland and we are aware that some have already been helping members who were also Farepak customers. This will enable them to do a lot more."
Consumer action group Unfairpak praised the scheme last night with spokeswoman Suzy Hall telling the newspaper: "I'm very happy they've done this. I would rather people went to credit unions than companies offering high-interest rates. It offers a short-term solution."
It is hoped that this will provide a safer way out for the 150,000 customers who were affected by the collapse of the Christmas savings company, who up until now have had to rely on other sources for their money.
Some had admitted being forced into extreme actions such as visiting loan sharks and taking out door-step loans, which typically charge astronomical repayment rates and could leave consumers facing even more debt.
© 2008 Adfero Ltd
Content for the uSwitch.com market news service is provided by a third party, Adfero Ltd. Whilst uSwitch.com makes reasonable efforts to check the reliability of this content, uSwitch.com does not guarantee the accuracy thereof or endorse the views or opinions given by Adfero Ltd, unless expressly stated otherwise.