Swimming with loan sharks? A Hackney solution

By Stephen Vaudrey

BEATTY GLASS, 92, remembers the tallyman well from the 1930s when her family moved to Clapton. He would “lurk around the flats”, she said, offering loans until payday or money for the children’s shoes. Their interest rates “really hurt”, she told me, and “woe betide you” if you did not cough up at the end of the month.

To avoid the tallyman, Hackney people have always tried to help one another. The 1914 leaflet pictured above, found during renovations to a local house, advertises a mutual society that looked after people’s savings and lent money when they needed it. They charged 5% interest — in old money, 1 shilling in the pound.

The double-dip recession in the UK has brought back the moneylenders: the number of loan outlets in Hackney has risen four-fold. Hard times seem to mean good business for loan companies — Hackney Citizens Advice Bureau (CAB) is seeing four times as many people in trouble with payday loan companies as it did two years ago.

Times have changed, though. The tallyman has had a makeover. He is now a slick TV commercial, a loan shop in the high street or a blingy pawn store. Behind the gloss, the interest rates are eye-watering,  in some cases 4,000%.

Stella Creasey, MP (Labour) for Walthamstow, has called these companies “legal loan sharks”.

Credit union office in Mare Street, Hackney
Credit union office in Mare Street, Hackney

But there is still the mutual alternative. Not far from Hackney Town Hall is a branch of the London Community Credit Union, a successor to the old mutual societies. Interest rates are 2% per month for short-term, unsecured loans and less for larger amounts. Saving with the credit union also offers an ethical alternative to the big banks.

So if you want to save or borrow some money, shop around and maybe give the Credit Union a call. If you are in trouble with a loan shark, the CAB, also handily located in Mare Street,  is there to help.

* The writer chairs Hackney CAB, which is at 300 Mare Street, London E8 1HE (0844 499 1195 advice line — sometimes closed for lunch); the Hackney branch of the London Community Credit Union is at 225 Mare Street E8 3QE (020 7729 9218).

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