A city councillor has called for Oxford Credit Union to be given rent-free premises in Cowley by the council.

Dan Paskins, Cowley councillor and executive member for social inclusion, spoke out after a credit union supporter told him the organisation would be charged more than £3,000 a year to rent a room at Cowley Community Centre.

Mr Paskins said: "We know a lot of people have problems with debt. The credit union is a brilliant way of trying to tackle this by helping people get loans which are more affordable.

"It should be spending money on loans, not renting a room.

"The city council needs to make sure premises can be found for the credit union, rent free."

Raymond Whittaker, of Littlemore Road, Cowley, voiced his concerns at an area committee meeting and wrote a letter of protest to the council.

The Oxford Credit Union, which already has base at Blackbird Leys Community Centre, hopes to open a branch in Cowley in August. Mr Whittaker said: "The credit union is a non-profit organisation mostly run by volunteers.

"The council owns the community centre and doesn't pay rent or rates so why should it charge £300 a month. I would not have any objection if it was privately owned but it's not. It should be for people in the community."

Cowley area coordinator Angela Christofoli said she would report back at the next meeting in June about what was supported through the Cowley Community Centre.

The city council supports the credit union by loaning staff and donating £20,800 in funds.

Brian Berry, chairman of the Cowley Community Centre Association, which runs the centre, said: "I have nothing to say about it, the rent is all agreed. If they want to they can write me a letter."

Sonja Lutticken, manager of the Oxford Credit Union Development Group, declined to comment about the rent agreement.

But she said: "People who don't have bank accounts are vulnerable to doorstep credit companies which go straight to people's homes and offer them credit at up to 177 per cent interest."

To volunteer call 01865 777757 or e-mail info@oxfordcreditunion.co.uk