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UW Credit Union Introduces Payday Lending Alternative

UW Credit Union is rolling out Paycheck Advance, an alternative to traditional payday loans on June 15, 2009. This innovative program will give members in good standing access to a short-term loan without the traditional loan application process. The program offers an interest rate dramatically lower than the average offered by storefront payday lenders.

UW Credit Union’s Paycheck Advance program has a fixed interest rate of 21.75%. The national average interest rate for payday loans in 2008 was 391%, according to The American Prospect, The New York Times and Consumer Credit Counseling Services.

“We applaud Wisconsin legislators for recently drafting legislation which would protect consumers by capping the payday loan interest charged by licensed lenders at 36%,” said Chief Executive Officer Paul Kundert. UW Credit Union’s Paycheck Advance program will offer loans in amounts from $50 to $500, and require a $50 minimum payment per month.

“The problem with storefront payday loans is that when you factor in the fees and the finance charges, it makes paying off the loan very difficult, if not impossible,” said Chief Credit Officer Mike Long.

Some of the advantages of UW Credit Union’s Paycheck Advance include:
-No application fee
-No monthly service fee
-No prepayment penalty
-Can be used multiple times without reapplying
-Provides a reasonable period for repayment

“Paycheck Advance is a better alternative than a traditional payday loan. It provides members access to small, short-term loans with an option that does not subject them to unreasonable rates and fees,” Long said. “In addition, our financial specialists are available to work with members to determine if this product is the right fit for their situation or if they qualify for a product that is even more beneficial.”

UW Credit Union has an on-going commitment to helping improve the well-being of its members through consumer friendly products and free financial education. Governor Jim Doyle selected UW Credit Union as a winner of the 2009 Governor’s Financial Literacy Award.


UW Credit Union is a growing, federally insured financial institution and a leading provider of affordable home loans, education loans, and consumer loans to University of Wisconsin communities. UW Credit Union’s 341 employees serve the financial needs of more than 130,000 members through world-class technology systems, and through a convenient network of 16 branch locations and 80 ATMs. With assets totaling more than $1 billion, UW Credit Union is ranked nationally among the leading credit unions. Founded over 75 years ago by members of the University of Wisconsin community, UW Credit Union continues to operate as a not-for-profit, member-owned financial cooperative with locations in the Madison, Milwaukee, Stevens Point, Green Bay and Whitewater areas. Visit UW Credit Union at www.uwcu.org to learn more.