Rochdale has been identified as one of twenty nine areas in the country home to “credit deserts” where people struggle to find affordable borrowing in a new report out this week from the thinktank Demos

The groundbreaking report f has for the first time mapped the UK’s credit environment, and has found 29 ‘credit deserts’, where people struggle to access affordable credit despite a clear need for it.

The Good Credit Index, made possible by NewDay, a leading UK consumer finance provider, combines 21 datasets, including credit scores, local high street provisions, data from county courts and web searches to give the clearest idea yet of how the area you live in affects your ability to get affordable credit.

While there are many ‘credit havens’, where there is a low credit need and a plethora of affordable credit options, there are also ‘credit deserts’, marked by limited access to sustainable credit options, where people have little choice but to turn to high cost, short term credit providers, like payday lenders and pawn shops.

Author of the report, Demos senior researcher Sacha Hilhorst, said: “For those with good credit scores and low need, it’s easy not to think about credit too much. But for millions of people, credit is a regular source of worry. With little savings and very limited access to affordable credit, something as ordinary as a fridge breaking down can send you into a financial tailspin.

“The Good Credit Index shows this is not just a matter of personal finances, but also geography. In places where insecure contracts are the norm and payday lenders are abundant, people face very different choices from people in credit havens. To break these cycles of credit is disadvantage, we need systemic change as well as place-based strategies.”

The report also found that there are fewer high street lenders operating than ever before.

Of the seven large high street payday lenders active in 2014, only two still sell payday loans. However, this doesn’t mean people are accessing more affordable credit, as lenders increasingly operate online.


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