TWO community savings schemes are planning to merge, in an effort to drive out loan sharks.

The Prince Bishops Credit Union would bring together East Derwentside and West Derwentside credit unions; and have about 1,000 members.

Leaders hope to get the green light from the financial authorities for a merger in October.

Members have already given their backing to the shake-up.

Officials say the move is aimed at providing low interest loans, secured savings and a lifeline of support to people experiencing personal debt problems or unemployment.

The announcement comes days after Robert Reynolds, 39, of Stanley, was found guilty of forcing Debra Wilson, a mother-of-four to repay £88,000 on a £500 loan.

Alan Stobbs, chair of East Derwentside Credit Union, said: "The merger of the credit unions will mean we will have more potential to attract new members.

"We will be able to provide increased levels of service which would not be possible for each union to do as a stand alone organisation."

Pat Cudden, chair of West Derwentside Credit Union, said: "The merger of the credit unions marks an exciting time for the credit unions.

"The new credit unions will cover a much larger area and rather than it being restricted to Derwentside it will cover all Durham.

"It is possible for anyone who either works or lives in Durham to become a member of the credit union."

The merger proposals are backed by Derwentside Homes, Durham County Council, County Durham NHS, Derwentside Council for Voluntary Services and regional development agency One North East.

Keith Tallintire, director of finance and corporate services at Derwentside Homes, said: "This recent case at Newcastle Crown Court highlights how important it is to offer people financial and technical support through credit unions and away from doorstep lenders.

"The merger of two of Durham’s largest credit unions into one will benefit our tenants and all residents of Durham. This is why we chose to support the proposals."

Credit unions are mutual financial organisations owned and run by their members, who can save with and borrow from the union.

For more information on the East Derwentside and West Derwentside credit unions, call 01207-588-549 or 01207-218-937.