BATON ROUGE, La. (10/21/15)--A credit union’s two-year-old partnership with a local ministry group to offer loans to those who would otherwise turn to payday lenders is paying off.
The loan program, known as Hand Up Loans, was launched in July 2013 between Pelican State CU and Highland Center Financial Services, a network of local ministries (Shreveport Times Oct. 18).
In two years, 21 loans were issued for a total of $29,611, according to the Baton Rouge, La.-based credit union. Since summer, the number of loans has increased to 30. Highland Financial Services backs a portion of the funds that are loaned out.
In providing an alternative to high-interest payday and title loans, the program addresses a social justice issue, according to the Rev. John Henson of the Highland Center Financial Services.
“We're trying to limit the lending they can do," Henson said of predatory lenders.
Heike Reagan, a Pelican State CU credit counselor, meets with each person referred to the credit union by Highland Center Financial Center. "We're trying to teach them to get back on their feet," she said. Borrowers are educated on budgeting and on how to stay away from short-term, high-interest lenders.
"This is to give them a helping hand so they do not have to go to payday lenders and check-cashing places. We want them to get a financial bank account to learn how to save money and eventually be on their feet," she said.