Delegates at this year’s Annual Representative Conference heard about the benefits of credit unions. Mark Lyonette outlines their role.
The festive season is almost upon us, and, for many, overdrafts and credit cards will fund this year’s gifts and celebrations – followed by a distinctive type of new year hangover when we stop to work out how we’re going to pay for it all.
And that’s before we think about all the other planned and unplanned expenses that put pressure on household finances these days. For many people, money is a source of real worry, and money-related stress is having a serious impact on the nation’s health.
Research conducted by StepChange Debt Charity in 2014 estimated that the annual cost of problem debt to the British economy was £8.3 billion.
This included a direct cost of almost £1 billion to the NHS for the treatment of debt-related health issues, and a loss of £2.3 billion to the economy from absence and low productivity related to debt worries.
So it’s clearly in everyone’s interests to help people get – and stay – on top of their finances. And one of the best ways to do that is to join a credit union. A credit union is a member-owned financial institution that provides savings accounts, loans and a range of services to its members.
Britain’s credit unions already serve over 1.25 million people from all walks of life. Over the last decade, credit union lending has doubled to more than £760 million, and deposits have trebled to more than £1.2 billion.
Which credit unions you can join depends on where you live or work or the employer or industry you work in. You can search for credit unions you can join here.
As well as providing a face-to-face service in communities around the country, more and more credit unions are partnering with employers so that staff can save or repay loans direct from their payroll.
Major public sector employers, such as local councils, the NHS, the Department for Work and Pensions and the Armed Forces, already offer this service, and we’re seeing more private sector employers recognise the value of helping their staff manage their money with a credit union.
Household names, including British Airways, Stagecoach, First Group and Royal Mail, let their employees pay into credit unions direct from payroll.
Saving straight from your monthly pay is the easiest possible way to get into a saving habit, and repaying loans direct from payroll gives credit unions more confidence to make loans when other providers might say no.
So joining a credit union today could make next Christmas – and all the other financial challenges life throws at us – feel a lot more under control.
- Mark Lyonette is chief executive of the Association of British Credit Unions Limited
AuthorMark Lyonette chief executive of the Association of British Credit Unions Limited
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