A NEW credit union is up and running in Worcestershire - offering a vital lifeline three years after the last one acrimoniously collapsed.

After serious lobbying from MP Robin Walker, a leading West Midlands credit union has announced its extension into the county.

Castle & Crystal, based in Dudley, is delivering 10,000 flyers to people living in the WR2 postcode area this week after agreeing to make its loans and saving accounts available.

Bosses at the union say they've been won over by concerns too many Worcestershire people are "piling up debt" and getting embroiled in problems with loan sharks or controversial payday lenders who levy 1,000 per cent repayment rates.

It follows the launch of another credit union in Worcester, Six Towns, which expanded into the city late last year and how has an office up and running in Lowesmoor.

Back in 2011, the old Black Pear Savings and Loans went bust in Worcester after customers ran off without paying their money back.

Castle & Credit Union started back in 1993 to help council workers in Dudley, but has since expanded to cover that entire town and now says it wants to be a success in Worcestershire.

It only employs four people but is planning a huge marketing drive to publicise its work, including a targeted Facebook campaign.

Among the loans on offer are sums of £1,000 which mount interest of just £77 over the course of an entire year.

It also offers loans up to £999 with interest rates of 2.75 per cent a month, or at the other end of the spectrum up to £10,000 at 0.65 per cent monthly.

Dharminder Dhaliwal, from Castle & Credit Union, said: "Robin Walker approached us last year and asked if we wanted to expand into Worcestershire and we're delighted to be able to do that.

"There are strong historical links between both areas, we're really keen to help both Worcester people and those across Worcestershire.

"Credit unions offer something that the banks cannot, we know people can struggle with debt from more traditional lenders."

Mr Walker said: "Nobody was more concerned than I was when the Black Pear credit union collapsed.

"Credit Unions can play a vital role in supporting people who do not have access to the banks.

"It is truly a matter for celebration that Worcester residents can now choose between two strong and growing credit unions."

For more details visit www.castleandcrystal.co.uk/