One of the features of being locked down for me is that you have more time to reflect. To look back on the things you have been part of and think about how it can make a difference for others.
In that vein I was thinking about the times I have spent working in Credit Unions (CU). I spent time a few years ago managing South Birmingham Community CU (Communisave), and I was President of Newtown South Aston CU in the late 80s and early 90s. Both CUs operated in areas of significant social and economic deprivation, both served populations who were in many cases experiencing both financial exclusion and outright poverty.
A CU is owned by its members and it is the members who decide how it works through the Annual Meeting and by sitting on the Board. It is the members who decide what dividend is to be paid back to members and what the lending and recovery criteria are. It is a community institution owned by the people, plus people’s savings are protected by legislation. I always found this a very attractive model.
Along with most community CUs we relied on volunteers working from community outlets to keep the finances flowing and the CUs viable. There were also school savings clubs, collection points in Day Centres and Libraries, and other things such as Food Cooperatives were set up by CU members.
I saw for myself that without the CUs so many people would be unable to save, or to have access to affordable credit lines for large purchases. Above all what I saw was that CUs gave people the feeling of having a stake and in their communities and in wider society, a feeling that what they said really did matter.
I well remember one member, a single parent with 2 children, saying that without the CU they could never have afforded to go on holiday to Spain. It had happened two years previously and the kids were still talking about it, and her savings were nearly enough to go again. Real excitement in a difficult life.
But the reality is that many community CUs are struggling to stay afloat financially, even with lots of members, because the savings being taken were simply not enough to cover the costs of running the CU in areas where people are struggling financially.
What is needed for local community CUs to thrive is for people earning salaries to put a bit into the CU, preferably by DD, so that the people who really need the CU can benefit from it.
It can be a small savings pot for the individual, you may get a declared dividend at the year’s end, you will have access to extremely affordable borrowing, and your money is secure because CUs are double regulated by the Financial Conduct Authority and by the Prudential Regulation Authority.
Best of all your money will help people who would otherwise have no access to many of the things that so many others may take for granted. It is, literally, a risk-free way to help change people’s lives. So if you earn a regular salary, and if you have a local community Credit Union, you could think about setting up an account with them. It could make all the difference.
Thanks
Chris Bain 