About Credit Unions

What is a Credit Union?

A credit union is a co-operative financial institution, owned and controlled by the members who use its services. Credit unions are also not-for-profit and exist to provide a safe, convenient place for members to save money and to get loans and other financial services at reasonable rates.

In credit unions, the members are the owners. Benefits of ownership include better rates on deposits and loans and better service. Regardless of their size or field of membership, credit unions are different than for-profit financial institutions. Credit unions exist to serve their members. Banks and other financial institutions exist to make money for their stockholders.

While for-profit institutions must make profits for their shareholders, in a credit union any earnings in excess of operational costs are returned to the members in the form of increased interest on savings, decreased rates on loans or other new and improved services.

About Credit Unions

Credit unions are not new. They operate in 79 countries worldwide serving a membership in excess of 118 million. Countries include America, Canada, Australia and Ireland.

There are over 600 registered credit unions in the UK with total assets of over £300 Million serving various communities and employers.

These include, British Airways, London Taxi drivers, Nexus, Stagecoach, BAE Systems, and many local authority employees. In the community credit unions are located in the major cities including Liverpool, Leeds, London, Manchester and Newcastle upon Tyne.

Regulated by the Financial Services Authority, members enjoy the same protection as they would expect from a bank or building society. Because they are managed and run by a volunteer board credit unions can offer attractive returns on savings and low rate loans.