AperiData launches pilot with UK credit unions to tackle illegal lending

Real-time credit reference agency and Open Banking platform AperiData has launched a pilot programme with some of its credit union clients, which will be supported by the illegal money lending team at Stop Loan Sharks England.

The England Illegal Money Lending Team is a specialist Trading Standards team that investigates and prosecutes loan sharks, according to its LinkedIn page.

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, helping more than 30,000 people escape from loan sharks.

Through the pilot, credit union staff will be trained during July to be able to better identify illegal money lending, using Open Banking insights and AperiData’s ‘Credit Console’ product to monitor reporting.

Initially, the pilot will be rolled out to employees at Unify Credit Union and Hull and East Yorkshire Credit Union.

Lisa Warburton, chief operating officer at Unify Credit Union, said: “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.”

AperiData confirmed 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”.

Fair4All reported in 2024 that almost one in 12 UK 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.

AperiData said that the credit union sector in the UK 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.

In May this year, AperiData received a £1 million investment from PayPoint, enabling it to expand its Open Banking solutions and embark on the next phase of growth.

AperiData will be exhibiting at Open Banking Expo UK and Europe 2024 on 15-16 October – find out more about exhibitors and sponsors here.