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Credit Unions: Official Discussion

edited 10 June 2010 at 2:48PM in Loans
164 replies 51.5K views


  • ahai1ahai1 Forumite
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    Doesn't this only work if your local credit union is registered with the site? That is what I heard on moneybox anyway.
  • Yes you are correct, credit unions are being urged to register with their contact details and lending terms so you can compare them with the other lenders. How ever by checking lenders in your area you will see what, in some cases, extortionate charges are being made (in my area one charges 284%) and if you bare in mind that the current max that credit unions can charge is 26.8% APR they represent excellent value. In money terms compare £500 loan over 12 months total repayable including interest with credit union=£567.36 compare that with lenders in your post code. Don't forget most credit union loans are covered by insurance (against death) at no extra cost and that your local credit union may charge a lower rate than this, so even less interest payable!
  • ahai1ahai1 Forumite
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    I have a question why does my credit union charge for services which are free at the bank? Like BACS.
  • All credit unions are individual businesses in their own right. My credit union does not charge for Bacs transfers but we have to pay for using the Bacs system. Credit unions main, and usually only source of income, comes from the interest on members loans and as we have over £2 million out on loan at most times of the year the interest is more than sufficient to absorb this expense but that does not mean that we might not decide to charge for this service at some future date. I don't know which credit union you are with but maybe they are trying to minimise their expenses by charging a small fee for this service to recover the costs that they are charged every year. You mention in a previous post that you have to go into their office to check your account so if thats the case why would you be wanting a Bacs transfer, surely they could give you a cheque or maybe cash if you are withdrawing money or taking a loan. Even though we are a medium size credit union we do not have online banking facilities or telephone banking available to our members, these services cost money to introduce and as we only have our members money coming in we can only afford to invest out of any profits that we make each year. They will come as they will with your own credit union. The more members who join, save and borrow will increase their income and profits and give them the opportunity to invest in new services for their members like you. Credit Unions do not have mega millions like banks to play around with, they are answerable to their membership for everything they do and that is why they are very careful with their members money to make sure that they do not put peoples savings at risk, unlike some institutions. If you want to see change then why don't you become involved by volunteering your time to help them grow and prosper, maybe even look after their website if you have knowledge required or maybe you have other skills which you could offer, I am sure that they would be interested if you offered. Go on give it a try!
  • ahai1ahai1 Forumite
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    I would still like the option as I don't want to carry around all that money with me.. I would also like statements so that I can see what money I have in there. The identity fraud thing is a pathetic excuse so that they can save money. If I can get statements from a high street bank then why not a credit union?

    As for the services yes it is alright if you are a borrower but not if you are a saver.

    Don't get me wrong the customer services at the branch are excellent but it lacks a lot of things like a high street bank. I am only using it to put aside £10 a month and I certainly would not consider moving my regular money into it. I was asked for employer details but I refused.

    One thing I also find disappointing is that the services are aimed at people on low incomes rather then for everyone.
  • Not meaning to cause you any offense but could I ask you why you joined a credit union in the first place, I am sure that they never promoted themselves as being able to provide all the services that a high street bank offers(one day maybe), what was the attraction for you?
    Historically credit unions have helped those on lower incomes because they were not judgemental of peoples previous credit history and were willing to give them a chance in life and I am sure there are many credit union members who now have savings behind them which they would never have had if they had not become credit union members.
    As I have said before, as credit union membership grows so will the products and services grow. Also with increased returns on there loans will enable them to pay higher annual dividends (not allowed to call this interest as there are no guarantees). It takes years for a credit union to arrive at a point that dividends can be paid on members savings and to make a point our credit union has over £150,000 in an monthly investment account and yesterday we recieved notice from our bank that the interest payable for the next month would be 1.8% and yet our dividend to our members for this year is 2.5% so are they not getting an excellent return!
    Credit unions are an attractive alternative to the main stream financial institutions for many different reasons and they have their place in todays society but it will be a few years yet before they take the place of your high street banks but believe me if they aspire to reach the heights that have been achieved in other countries they will be on a par with them. To get there they need the support of you and as many new members as they can attract, they will be in the years to come a viable alternative to high street banks but will never lose their sense of supporting the community.
  • ahai1ahai1 Forumite
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    I had dealings with them in the past and they once used to reply to my emails. Once I actually got an email from the director. Now they just ignore emails and cannot be bothered to even update the site. I was not aware since dealing with them the standards have declined. I was thinking of joining then but never got around to doing it then.

    Leaving aside the charges I do expect a reply from an email.

    I don't have credit problems so that side does not appeal to me.

    I would encourage people to join as in the long term I am sure that we are going to get something back but I would never consider moving my day to day money into it unless I could get easy access.

    I treat it as a long term investment. According to reports about increased membership it seems like I have made the right bet.

    As for the interest I have a number of interest bearing accounts. As my current account no longer gives interest I thought that I would put some of it just £10 a month in a credit union account.

    I am more concerned about customer service. I have said it is good at the branch but they don't seem to try and do anything out of the branch.
  • Hi
    I am please to hear that although you have some issues you would still encourage others to join your credit union. Your reasons for not putting all your eggs in the one basket are very valid and acceptable. In time the services that you require will, I am sure, become a reality, offering you a viable alternative for your financial needs.

    You are correct when you say that you should receive a reply to any email you send to them and yes if they have a web site it is imperitive that it is kept up to date as it is their window to the world. Judging by all of your comments I would say that you have a good knowledge of the world of finance and that you are or have worked in a field where customer service is seen as being one of the most important factors in running a successful business of any kind. I believe that you possess skills, talents and knowledge that would be of benefit to your credit union if you were able to offer a few hours a month of your time. Sometimes new blood with new ideas can act as a catalyst to a change in attitudes and re-energise peoples entheusiasm in what they are doing. I am not saying that these are issues within your credit union but I do think that you should seriously consider becoming a volunteer because I think you may have a lot to offer them. There's no harm in giving it a go, you might find that you like it and become a committed credit unionist!
  • ahai1ahai1 Forumite
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    At the moment I don't have anytime.

    What places like that need is professional management. In my experience I have come across many places where the idea and the concept is good but there is a lack of leadership.

    If I know when the next AGM is I will go and ask a few questions.
  • Well I hope one day you will have some spare time to offer and I hope that you find answers to your questions at their AGM. I just ask you to remember that other than paid staff, all other committees including the board of directors receive no renumeration for their services and that they, in almost every credit union, will represent the majority of the people involved in the operation of the credit union. Its because of the committment of these people and the belief in what they are doing that we have a credit union movement in this country today. Time is so very precious today as we all lead hectic lives whether through choice or circumstances but we should all try to find time to give something back by volunteering, not neccessarily in credit unions (although I would encourage that) but to any organisation that relies upon people who give their time freely not looking for financial gain but just for the satisfaction that volunteering can bring to them and to those that they help.
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