Credit Unions are financial co-operatives owned and controlled by their members. They offer savings and great value loans. They are ethical; profits are reinvested into the credit union to help provide more affordable services and to pay dividends to members. More and more people are turning to credit unions as their primary choice of financial services provider with less trust in UK banks than any other sector.
Becoming a member
Credit unions are non-profit financial for members with something in common. At Crownsavers, the “common bond” is that all members need to work in the Borough of Lewisham in order to join. In other credit unions it could be that members live in the same town, work in the same industry or are members of a particular trade union. You can also usually stay in the union if you're not in the bond anymore. So if you move house or job you may still be able to remain a member.
Once you’re a member, you can become involved in decision-making by attending AGMs or other member meetings. You can also apply to join the board of directors to help run the organisation.
Benefiting the community
Credit unions exist to benefit their community. There are now around 500 credit unions in the UK. About 1 million British people are members of a credit union. Members mutually benefit each other as there’s no profit for external shareholders.
Credit unions can offer a lifeline for people who have bad credit and can’t get access to ordinary bank products and are an affordable alternative to payday loans or doorstep lending. But they are also popular with people who want an ethical place to invest their money.
The affordable alternative
Credit unions offer savings and loans. Some offer current accounts and mortgages. Unlike many high street banks, credit unions offer small loans of £50 to £3,000. The loans are a much cheaper alternative to payday loans, whose interest rates are often sky-high.
Dividends for members
People with credit union savings usually receive an annual dividend. The rate of the dividend can vary as it often depends on how well the credit union does that year.
Keeping your money safe
Credit union savings have exactly the same protection as normal savings accounts. They offer this protection through the Financial Services Compensation Scheme (FSCS). The FSCS will cover your savings and pay back up to £75,000 per person or institution.
Global Credit Union facts and statistics
Source: (WOCCU statistical report 2014)
Great Britain Credit Union Stats
Source: (Bank of England's Annual Statistics 2014)
Crownsavers Credit Union Is a Registered Deposit Taker