The Stamford and Deepings branch of Lincolnshire Credit Union has opened in the town and already has more than 40 signed up members.
An official opening was held with Stamford mayor Brian Sumner on Wednesday who gave his approval to the scheme which has been operating in town for two weeks.
The credit union is offering small, low interest loans to stop people who need some extra cash before payday.
The group, which is controlled and funded by members, has been set up to offer an alternative to people tempted by payday loans companies which offer small sums of money with huge interest rates.
The credit union is currently open one day a week, on Wednesday from 11am to 2pm at Citizens Advice Bureau in High Street, Stamford, but is looking for more people to get involved so it can extend its opening hours.
Member Harrish Bisnauthsing, who is also a Stamford town councillor said: “We are here in Stamford and we are here to stay. This is a service for the people.
“We want people to be more in control of their own money and stay away from loan sharks.”
The group currently has 15 fully trained volunteers and 42 signed up members but it is looking for more people to get involved.
For more information call 01780 756000 or e-mail co-ordinator Linda Burden at firstname.lastname@example.org