Credit Unions

Many will be familiar with Farepak, the Christmas savings club. A credit union works on the same principle as a mutual society or a community bank. Farepak, sadly, had no protection for savings but a credit union is a very safe home for both saving and borrowing.

A credit union is not-for-profit organisation and regulated like banks or building societies so money is safe. Members save on a regular basis and can apply to borrow from what they and others have saved.  Saving with a credit union earns interest through dividends each year. There are no shareholders and credit unions are usually run by volunteers so interest rates are low, around 1% per month on the reducing balance of what you have borrowed..

Life insurance is included, there are no early repayment charges and both unsecured and secured lending are possible.The 450 credit unions in Britain are a small part of a worldwide and growing movement. 40,258 credit unions, enable 118 million people to save and borrow in 79 countries.

The disciplines of saving and careful borrowing are at the heart of the credit union movement and churches are involved across the country. Setting up a credit union from scratch is not a quick and easy win for those in churches who feel called to this type of social action. Consider linking with an existing credit union neighbouring your area or become a volunteer with a credit union. This can be a very effective way of addressing money issues in church and community.