Provident Financial has announced this week that is to close its doorstop lending business after a wave of compensation claims. Provident has been a key source of loans for people with poor credit ratings for 141 years and its demise with have a worrying effect on their financial well-being.

Access to a legal and affordable source of credit is limited for many people with poor credit ratings, and limiting that access even further might mean more people will turn to loan sharks for quick and easy loans. But doing this can have devastating consequences and put people into a spiral of debt that will affect their mental health as well as their finances.

There is another way. Credit unions are a fair and legal source of loans for people with a poor credit history. As local community-owned financial services providers, they have their members (because that is what we call our customers) at the centre, and take individual circumstances into account.

Last year Hoot members saved over £1.2m in loan interest by taking their loan with us rather than a doorstep lender or loan shark. The added bonus to borrowing from your credit union is that you save as you borrow. Most new borrowers with Hoot are saving for the first time and building a nest egg of savings for the future.

So beware the ‘easy fix’ of your local, illegal money lender. If you are offered a loan with no paperwork, it will be unregulated and you will stand to lose a lot of money in the long run.

Go to our loan pages to see how this safe and affordable alternative is the better way to go.

Anyone who thinks they have been caught in a trap by a loan shark can contact the Illegal Money Lending Team confidentially on 0300 555 2222 www.stoploansharks.co.uk