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What is a Credit Union?
What is a Common Bond?
Who runs the Credit Union?
What are the aims?
Is your money safe?
Savings?
Withdrawals?
Loans?
Repayments?
Interest Charges?
Insurance?
Hidden Costs?
Confidentiality?
Democracy?
How does it work?
What is in it for me?
A Credit Union is a democratic financial Cooperative owned and controlled
by its own members. All Credit Union members have something in common (the
common bond) and every member has an equal vote in the running of the Credit
Union.
A Credit Union is a non-profit making financial co-operative run entirely
by the people for the people. It is an effective way of creating a pool of
available money in a particular locality.
Credit Unions are run by members, for the members, and offer a convenient savings and low interest loans service. Savings are kept and used within the community, giving us more power over the money in our pockets and more choices over where we spend it. This benefits local businesses and helps to strengthen the local economy in a sustainable way.
When we buy on credit we often limit our choices and end up paying high prices for the goods we buy. Instead of a constant money drain out of YOUR county in the form of high interest rates, bank charges, credit cards and mail order purchases, YOUR Credit Union can help YOU.
YOU can help YOUR community prosper.
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The Common Bond is the factor that unites every Credit Union member. A ‘Common Bond’ is defined as:
Once a Credit Union has been established in the community by a ‘steering committee’, officers are elected from among the members to run the Credit Union.
All Credit Unions are registered in accordance with the Credit Unions Act 1979.
All officers and volunteers sign a declaration of confidentiality, so all
members’ information is kept totally confidential at all times. A qualified
auditor prepares the Annual Audit Report which is submitted to the members
at their Annual General Meeting.
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To encourage members to save regularly
To provide low cost loans
To help to manage money efficiently amongst its members
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Yes we are members of ABCUL — the Association of British Credit Unions
And we are regulated by the same banking authority as your high street branch
the FSA — Financial Services Authority
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Credit Unions encourage their members to save regularly, however small the
amount. They operate friendly and accessible collection points, at times and
in places which are most suitable for their members. You can choose to save
weekly or monthly.
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Members can withdraw their Credit Union savings after a small notice period,
provided they are not pledged as security on a loan. However, you are encouraged
to keep your savings intact to maintain your capacity to borrow.
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Loans are granted to members of the Credit Union on the basis of their saving
record, their capacity to repay and according to the Loans Policy of the Credit
Union. Repayment is through the same local collection points. You can take
out loans once you have been saving for 13 weeks if saving weekly, or 3 months
if saving monthly.
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Repayments are designed to be flexible and are negotiated with you to meet
your own capabilities.
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Because Credit Unions exist only to serve their members, loan costs are only
1% per month on the outstanding balance. This 1% is worked out on the reducing
balance of your loan. For example, to borrow £100.00 and repay over
12 months would cost just £6.25.
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As any other financial institution if the Credit Union collapsed funds from
the financial services compensation scheme would ensure you would not lose
any of your savings. This is of course not likely to happen but it does put
peoples minds at rest. Your savings are protected by insurance which covers
theft, fraud and misappropriation of funds in addition to cover for loans
in the event of the demise of a member. All at no cost to YOU.
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There are NO hidden fees or costs involved in transactions with the Credit
Union.
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All transactions are confidential. Every volunteer who works in the Credit
Union will treat all information as strictly confidential.
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Equal rights exist for every member, whatever amount they have saved, to
use the services of the Credit Union and to work as a volunteer within the
Credit Union
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There are low cost loans available after 13 weeks of regular saving to all
our adult members. We have a credit community who will vet the application
and if funds are available you can borrow up to three times your saving balance.
Examples:
| loan amount | repayment period | weekly repayment | interest |
monthly repayment |
interest | savings needed |
| £100 | one year | £2.05 | £6.21 | £9.00 | £6.54 | £33.00 |
| £500 | two years | £5.42 | £62.88 | £24.00 | £63.50 | £166.00 |
| £2000 | three years | £15.29 | £383.55 | £67.00 | £387.39 | £667.00 |
We can honestly say that joining the Credit Union is good for one and the
whole community. The whole ethos of the Credit Union is to keep the money
in the local area which in turn helps to boost local shops and businesses
and in so doing this makes the local community stronger and more self sufficient.
The nature of credit unions at large is for people to help people.
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