THE head of Letterkenny’s Credit Union says there was “not a lot of grá” for Provident Financial because of its “extortionate” interest rates.

Gordon Randles was speaking after the door-to-door money lender announced it was shutting its operations in Ireland.

In a statement the company blamed the strain of the coronavirus pandemic for its decision to stop lending.

The announcement came days after Minister for Finance Paschal Donohoe said the government was planning to gradually lower the current interest rate cap on licensed money lenders’ loans.

According to Provident Ireland’s website, its Annual Percentage Rate (APR) of Charge stands at 187.2 per-cent.

Mr Randles said any Credit Union would take a “dim view” of money lenders and their “extortionate rate”.

“They had an APR of 100 plus per-cent. We have a household budget loan which has an APR of 7.2 per-cent. You can see the extreme difference and the hardship Provident would have brought on any household income,” said the Letterkenny Credit Union CEO.

A previous advertising campaign saw the Credit Union take on Provident directly by highlighting the difference in their lending rates.

The interest on a €300 loan from Provident was in the region of €90 while with the Credit Union it is less than ten euro – “a massive difference”, he said.

“We would not have a lot of grá towards door-to-door money lenders because of the interest rates they charge.

“What we would be saying is that we are always here to help and that people should come and engage with us and build a relationship with us.

“The tagline of our household budget loan is ‘don’t let small problems become big problems’ and we will always encourage people to come in and see us because if you build that relationship it will be beneficial in terms of loans.”