The $98 million Greater New Orleans Federal Credit Union has announced the roll out of a program designed to help members avoid having to use payday lenders.
Dubbed Safety Net Solutions, the program provides members with two savings related products: Safety Net Advance and Safety Net Savings, the credit union said.
Developed as a payday loan alternative, the program delivers additional safety features separating it from the financial pitfalls of conventional payday loans. In fact, this program is designed so members can break away from the high risks of the payday loan cycle and create good credit.
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The maximum Safety Net Advance allowed is $300 with a 30-day repayment term. After three months, participant must complete a BALANCE Financial Fitness training module to continue to participate in the Safety Net Solutions Program.
The advantage of the Safety Net Savings is that members develop healthy savings habits. With each cash advance, a total of 10% will be automatically deposited in a savings account. Once $500 is accrued, GNOFCU will release $250 for withdrawal. This savings account does earn interest, but ATM access is not allowed. The goal is to have members create stable savings habits, as well as set aside enough money for a secured share loan to establish good credit, the credit union said.
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