21 October 2021 is International Credit Union Day. The theme for 2021 is “Building financial health for a brighter tomorrow”. Our Money Advice Officer, Steven, explains about Credit Unions and how they can help you.
What are Credit Unions?
Credit Unions are financial co-operatives which provide savings, loans and other services to their members whilst being fully owned and controlled by their members. They are open to everyone and provide a financial community where all members contribute and benefit directly instead of shareholders, so the emphasis is on providing a good service to members rather than maximising profits.
Credit Unions can be a lifeline for people who are excluded from the retail banking sector and by joining one you are helping others in your community. They can offer loans at much lower interest rates than doorstep or payday loans and usually allow low weekly payments. They are not-for-profit, usually offer help and advice to encourage their members to save money with them and ensure any loans they take are affordable. They are also just as safe as mainstream banks as they are closely regulated to ensure they have enough money to stay afloat and are also backed by the Government’s Financial Services Compensation scheme.
At the end of September 2020, the British credit union sector had:
Around 240 credit unions across England, Scotland and Wales employing more than 1,600 staff
1,355,630 people using credit unions, including 116,502 junior depositors
Total assets of £1.95 billion
Total loans of £1 billion
Total deposits of £1.68 billion
Annual turnover of £135 million
Source: Bank of England Credit Union Annual Statistics 2020
Why should you join one?
There are many reasons to join a Credit Union:
Mutual and ethical savings
They offer a range of savings accounts and you can choose to save as little or as much as you can afford.
They offer loan products suited to your individual needs and at rates you can easily afford.
Run by you, for you
You are in control of your own finances and have a say in how your financial service provider is run.
Putting you first
They serve you, the member, by listening to your needs and developing products and services that you want.
Where can you join?