LONDON–The credit reference agency and open banking platform AperiData has launched a pilot program with some of its credit union clients in this country that is being supported by the illegal money lending team at Stop Loan Sharks England.
The England Illegal Money Lending Team investigates and prosecutes loan sharks, according to its LinkedIn page.
The organization said that since launching in 2004, the team has prosecuted more than 400 people for illegal money lending and other crimes, and has written off £85 million in illegal debt and helped more than 30,000 people escape from loan sharks.
According to the organizations, through the pilot, credit union staff will be trained to be able to better identify illegal money lending, using open banking insights and AperiData’s “Credit Console” product to monitor reporting.
The Rollout
The pilot will be rolled out initially to employees at Unify Credit Union and Hull and East Yorkshire Credit Union.
“At Unify we are happy to be working with Stop The Loan Sharks and AperiData to help raise awareness of unregulated borrowing in the credit union sector,” Lisa Warburton, chief operating officer at Unify Credit Union, said in a statement distributed by AperiData.
AperiData said in its statement it will follow the pilot’s progress, and that it will “take any lessons learned forward into our Credit Console product development before rolling out on a wider basis.”
Many in U.K. Turn to Illegal Lenders
Citing data from Fair4All, in 2024 almost one in 12 U.K. adults have turned to illegal lenders over the past three years, and that 7% of adults, equivalent to 3.3 million people, have used or believe someone in their household has used, illegal lending since 2021.
“Illegal money lenders tend to use harassment or the threat of violence against individuals using their services, and charge high interest rates and fees, which can lead to already vulnerable consumers paying more for products and services,” the organizations said in a statement.
CUs Can be ‘Bulwark’
AperiData stated it believes the credit union sector in the U.K. can provide a “bulwark” against illegal money lenders in the communities they serve by “providing financially excluded individuals with fairer products, and identifying where illegal money lending is occurring and the impact it has.”