A credit union, a type of financial institution similar to a commercial bank, is a member-owned financial cooperative, controlled by its members and operated on a not-for-profit basis.
A Credit Union is a mutual financial organisation, owned and run by its members. To use a credit union you must be a member, and membership is reliant upon having a shared fellowship with the union - this could be belonging to the same trade union, or living or working in a specific location or having a specific area of expertise.
Credit Unions are designed for people who don’t want the risks of a bank account, but still want the ability to save money. Savings accounts with credit unions earn interest, and can be set up under a Christmas savings account system – which means you cannot take money out before November without prior notice.
For more information on Credit Union savings accounts, follow this link.
Loans from credit unions are designed to only allow you to borrow what you can afford to, or will not allow you to borrow until you have proved you can save money regularly.
The Annual Percentage Rate (APR) on credit union loans is limited to 26.8% meaning interest rates are lower than other types of loans.
To find your nearest credit union, and for further information visit the Association of British Credit Unions Limited.
Credit unions are regulated by both the FCA and the Prudential Regulation Authority (PRA) and both regulators are involved in the authorisation process of a credit union.
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