Credit unions are “friendly society” which more commonly known as co-operatives. They are not-for-profit organisations, which are set up by members that have something in common to benefit their community.
In the UK, credit unions have been in existence for more than 50 years. They have continued to grow to provide loans and savings to over one million people across the England, Scotland and Wales. Currently, there are about three hundred credit unions in the UK. In fact, globally, there are 217 credit union members in 105 different countries. This shows that credit unions are highly reputable (findyourcredit.co.uk, 2020).
All credit unions are authorised by the Prudential Regulation Authority (PRA) and regulated by the UK Financial Conduct Authority (FCA). All money saved in a credit union is protected up to the value of £85,000 by the Financial Services Compensation Scheme (FSCS). Therefore, you can be reassured that your money is safe.
Credit unions are for everyone where they provide a financial community. Credit union members are required to save regularly and after which they are able to borrow loans from the pool of savings.
In terms of management, credit unions have a Board of Directors who offer their services and advice on a voluntary basis and are elected at an Annual General Meeting.
To become a member of a credit union, you need to share a ‘common bond’ with other members. This could either be through working or living in the same area.
For M for Money, our common bond is Buckinghamshire; Berkshire; Milton Keynes; LB Hillingdon; LB Brent; LB Harrow.