More people than ever struggling to cope with debt in Dudley

The stark warning comes in the wake of the collapse of Castle and Crystal Credit Union (CCCU) which offered low-cost savings and loans for Dudley borough people.

CCCU was a not-for-profit organisation which started as a credit union for Dudley Council workers before opening up to anyone living or working in the borough but went into administration in May.

Siobhan Darkin, head of services at Citizens Advice Dudley and Wolverhampton, said: “As an organisation, we’re helping more people than ever before who can’t afford to cover essential costs – like food, energy and housing.

“Currently, more than half of the people we help with debt advice are in a negative budget – meaning their income is not enough and they are often getting into debt just for trying to cover their essential bills.

“Within our local Dudley area, we are seeing clients consistently struggle to meet their energy and council tax costs.”

Citizens Advice works alongside partner organisations to help people avoid aggressive illegal money lenders known as loan sharks and credit unions are regarded as vital to keeping people out of the clutches of crooks.

Stop Loan Sharks, an organisation that investigates illegal money lenders, said: “Working alongside credit unions across England we have been able to raise awareness of the threats loan sharks present to our communities while offering an alternative in the form of credit unions.” Ms Darkin added: “As an organisation, we provide benefit checks and income maximisation advice throughout all of our debt appointments to ensure every client is equipped with the tools needed to increase their financial capability.

“We also work very closely with the Illegal Money Lending Team in England to raise awareness about the risks of loan sharks and the alternative options available to clients.”

Although Castle and Crystal has now ceased trading, clients will not lose their funds which are protected by the Financial Services Compensation Scheme (FSCS).

Joint administrator James Sleight, of PKF Littlejohn Advisory, said: “All of CCCU’s savers will have their balance returned by the FSCS.

“They don’t need to do anything to get their money back; savers should look out for a letter in the post from the FSCS in the next few days.”

Information and advice are available for people on the ‘struggling with debt’ page on Dudley Council’s website.

Speaking in June 2023 after a suspected loan shark was arrested in Dudley, the then Dudley cabinet member for public health, Councillor Ian Bevan, said: “Illegal money lending is unacceptable, and we support the Illegal Money Lending Team’s work to prevent the activities of loan sharks in the borough.

“Illegal money lenders often start by being very friendly and seem to offer the answer to people’s problems, but that soon changes as the debt and interest charges grow,” he said.

“We encourage everyone to follow the Illegal Money Lending Team’s advice and to report any suspected loan sharks.”