Savings and loans • Fair and squareLogin
Nearly a decade after Iain May left banking, the minister of South Leith Parish Church decided that it was time to put his financial know-how to good use.
It’s easy to imagine May, broad-shouldered, welcoming and sociable, in more corporate surroundings. But in his blue shirt and white minister’s collar, he seems perfectly at home in the church halls of this port area in north-eastern Edinburgh, which host everything from food banks and breakfasts for the homeless to Scottish country dancing and rehearsals of a seniors’ choir.
A few yards away, the local streets still offer visible evidence of the effects of the 2008 financial crisis and the austerity that followed. “About six months after I started in the parish . . . I was walking through the local shopping area and counted nine payday lenders or cash convertors within literally a couple of hundred yards,” May tells me.
His colleague at the nearby Roman Catholic church had noticed the same thing. The conversations that followed resulted in May leading a very different kind of financial enterprise from those with which he had spent most of his career. This time, he was seeking to help tidy up the mess created by the sector that once employed him.
May established himself at Royal Bank of Scotland after entering banking at American Express. Before working in finance, he had spent time in the merchant navy. He joined RBS as a marketing manager for its credit-card business in the early 1990s, just as the bank embarked on its transformation from a venerable Edinburgh institution into a leading global player. He was involved in a programme called Project Columbus, which was part of the target-obsessed sales culture that contributed to the bank’s downfall.
After leaving RBS, May moved to Dublin to work for Allied Irish Banks (AIB), which, like RBS, was later bailed out after the bursting of the credit bubble it had helped to inflate. But by this time, May had begun to turn his back on the industry.
“By the mid-Noughties, there was something inside me saying the banking world was crazy,” he tells me. “I wasn’t very comfortable at all.”
The challenge to his moral code became too great to ignore. When May and his family decided to move home to Scotland, his employer assumed that he was having a midlife crisis. And, in a sense, he was. “I decided I wasn’t going back to the world of finance,” he tells me. “I was back in my home church and the call for the ministry became stronger.”
Those thoughts had been bubbling under the surface for some time, though unacknowledged. In 2007, as the banks hurtled towards crisis point, May began training for the ministry. As career moves go, the leap from banking to the Church of Scotland was a big one. Did he ever question it?
“You have doubts. But it’s affirmed by your progression,” he says. “Throughout your training, you work in a church environment on placements and with a minister, and you’re constantly assessed. There’s that sense of affirmation.”
While he was studying, RBS and AIB were on the brink of ruin. It didn’t come as a shock to him. “You could see all the signs when I was there. Most of the bank’s loan book was in property, a lot of it residential. I remember a member of staff at AIB coming to me wanting to buy her first flat in Dublin, and she wanted to borrow seven times her salary. I challenged it, but I was told to sign it off. Different times.”
By 2012, when May was settling in to his new parish, payday lending was booming. He quickly started a food bank, but the need for more preventative action was clear. As a result, Castle Community Bank (CCB) was formed last year from the merger of two local credit unions. May, the director of this not-for-profit bank, describes it as a “social justice mission” that provides the community with an affordable alternative. People often don’t realise that they do have a choice, he says.
“Someone using payday lenders will borrow, say, £300 and then take out another loan to repay it. All they needed was the £300 loan spread over 12 or 18 months to let them get back on their feet.”
Leith has undergone a stark transformation in recent years. It was listed among the UK’s top “hipster hot spots” last year, but deprivation and hardship remain. The demand at the Edinburgh north-east food bank, of which May is chair, attests to that. And while the City regulator saw to the payday lenders, the local pawn shops and cash convertors are as prominent as ever.
The CCB operates on a basic savings and loans model. According to May, what is crucial is that clients have access to it 24 hours a day, which they can’t with most credit unions. Its membership has grown by more than 50 per cent in the past six months, in part as a result of online applications that facilitate the kind of quick and easily available lending that payday lenders have used to such damaging effect.
“Why should the poorest have to pay more for good services?” May says. “We can’t solve every problem and we have to be a responsible lender. If someone’s in a mess, we’ll send them for debt advice. But we see what we can do.”
May is back in the world of finance, but as far from his past life as he could imagine.
“I wouldn’t change anything. It’s tiring, but everyone helping out – including the board – is doing it voluntarily, and with that same sense of a call to make a difference for other people,” he tells me.
“They might not all be driven by God, but there is that moral compass.”