Tag Archives: ABCUL

ABCUL launches Work Not Worry social media campaign

ABCUL – the Association of British Credit Unions – has launched a social media campaign, Work Not Worry, to raise awareness of the benefits of partnerships with credit unions among employers and to encourage more employers to establish new relationships with their local credit union.

Evidence suggests that financial stress costs the UK economy £121bn (Neyber 2016) and 30% of employees are making uninformed financial decisions about saving and spending (CIPD, 2017). 26% of working age adults in the UK have no savings and 1 in 4 workers have lost sleep over money worries (CIPD, 2017).

Work Not Worry

Credit unions offer savings and affordable loans with payments deducted from pay and, for over 30 years, employers have used the services of credit unions in their workplace. This includes household brands and institutions such as Admiral Insurance, Royal Mail, British Airways and the NHS. Research funding by Citi Foundation states that 70% of employees who take advantage of credit union partnerships feel more financially capable and better supported and 83% of employer partnerships demonstrate Corporate Social Responsibility to staff by providing a material benefit at little or no cost to them.

A majority of employers say working with credit unions improves the financial capability of staff and thus helps create a more productive and better supported workforce.  This is backed by Money Advice Service research on employer best practices on financial challenges and their impact in the workplace, which states that 59% of employees with current financial worries say money concerns prevent them from performing their best at work.

A lack of savings is a major problem for many workers, but credit unions’ offer Save As You Borrow  – which asks people to save a small amount while repaying their loan – and this has great benefits in creating a savings habit.  Research by the Fairbanking Foundation found that while only 26% of credit union borrowers saved regularly before joining their credit union, 71% intend to save regularly after repaying their loan.

Matt Bland, Head of Policy & Communications at ABCUL, said: “In our conversations with employers, it is clear that many are not aware of the financial difficulties facing their staff.  Those that are have sadly seen it became a serious issue in the workplace before they had chance to respond. We regularly hear horror stories of people falling into a downward cycle of repeated and escalating payday loans.

“Credit unions have a proved track record of turning borrowers into savers. Research such as the Save As You Borrow report proves that credit unions are playing a vital role in helping their members become financially responsible. The report shows that credit unions turn 71% of borrowers into savers and that 96% of employees that are encouraged to use payroll deduction through the credit union have found it helpful.

“All employers have to do once a partnership is set up is spend a couple of minutes making the deductions each pay day – one file transfer, one payment. All employees have to do is agree to a deduction of their choice per month – and it comes directly from their salary, making life easy for everyone.”

The campaign runs for four weeks from 9 July – 3 August. For more information about the campaign and to search for a credit union partnership, visit http://worknotworry.org/

International Credit Union Day theme announced

ICU_Day_2017_Logo_EN-page-001 - CopyThis year’s International Credit Union Day, which takes place on 19 October 2017, will have the theme “Dreams Thrive Here.”

International Credit Union Day takes place every year on the third Thursday in October and, this year, credit union professionals decided the theme via an online poll.

All 56,000 credit unions around the world are being encouraged to share photos, events and experiences online to help promote the movement. The day aims to raise awareness of the contribution that credit unions make to society.

Brian Branch, President and Chief Executive of the World Council of Credit Unions (WOCCU), said: “ICU Day gives us an opportunity to encourage credit union members to get engaged, share their experiences and celebrate how credit unions and financial co-operatives have made an impact on their life choices.”

Read more about this year’s International Credit Union Day. To find out about credit unions in the UK, visit the Association of British Credit Unions (ABCUL).

Credit unions can help solve poverty

A major new report on tackling poverty in the UK has highlighted the role that credit unions can play.

We Can Solve Poverty in the UK Report

The report, We can solve poverty in the UK, from research charity the Joseph Rowntree Foundation (JRF) offers a plan to end poverty in this country by 2030. It is the most comprehensive strategy of its kind to set out how to solve poverty across all groups in the UK, calling for a new ‘long term deal’ to solve poverty between governments, business and the public.

A role for credit unions is identified in providing fair and affordable access to credit, as well as in helping people to save, budget and avoid problem debt.

The strategy encourages employers to provide – and promote the take-up of – credit union membership as a staff benefit to promote saving and access to affordable credit, highlighting the ease with which employees can save and repay loans direct from payroll. It also calls for the expansion of credit unions’ capacity to provide affordable credit through support from employers, local government and social investors.

The report recommends that tackling poverty should be an explicit aim in social landlords’ business plans and strategies, arguing that: “Housing associations could play a role in delivering affordable credit to their tenants, as part of a wider financial inclusion strategy, working with credit unions where possible.”

Launching the strategy, JRF Chief Executive Julia Unwin said: “Poverty divides communities and generations; it harms people’s potential and strains families; it drains the public purse and holds back our economy. The Prime Minister has made a promise to make Britain work for everyone and reform capitalism. As Westminster reconvenes this week, I urge her to deliver on this promise.”

To mark the launch of this significant strategy, JRF has teamed up with Big Society Capital to work towards raising up to £20m of social investment to tackle the ‘poverty premium’, whereby people on low incomes pay more for goods and services including credit and financial products. The initiative will support charities and social enterprises to develop solutions.

Mark Lyonette, Chief Executive of the Association of British Credit Unions Limited (ABCUL), said: “We welcome the JRF’s recognition of the role credit unions play in helping alleviate hardship and poverty. Credit unions are proud to serve people from all walks of life, which includes those who may struggle to access credit and financial services from other providers. The expansion and modernisation of Britain’s credit union movement will make us even better equipped to provide services to people right across our communities.”

 

Scottish Government backs call for workplace savings

ABCUL logoABCUL – the Association of British Credit Unions Limited – has welcomed the Scottish Government’s backing in its campaign to make access to credit union savings and loans a standard workplace benefit.

A new report – “Scotland’s Credit Unions: Investing in our Future” – published on 10 February outlines the Scottish Government’s support for making payroll deduction partnerships between employers and credit unions as popular in Scotland as it is in other countries like the United States.

ABCUL Chief Executive Mark Lyonette said: “It’s no coincidence that the world’s most successful credit union movements have close links with employers, making saving and repaying affordable loans really easy for people via payroll deduction.

“We’re delighted that the Scottish Government has responded to our call to make access to credit unions a standard workplace benefit, and we look forward to Scotland becoming a Credit Union Nation where employees, businesses and the wider economy all benefit from a more financially healthy population.”

The First Minister of Scotland Rt Hon Nicola Sturgeon MSP has written a letter to employers highlighting the benefits of working with credit unions.

Nicola Sturgeon writes: “The Scottish Government recognises the valuable role played by credit unions in building financial health by providing financial services and products to a wide range of customers.

“So I am urging employers across Scotland to get in touch with a credit union to explore establishing a payroll deduction relationship with a view to improving financial health and boosting the productivity of Scotland’s businesses.”

The Scottish Government report can be read here.

Credit unions welcome £1 million a year commitment from Lloyds Banking Group

ABCUL logo

ABCUL welcomes Lloyds Banking Group support for credit unions.

Lloyds Banking Group has re-emphasised its commitment to providing leadership in the area of financial inclusion by announcing its intention to provide £1 million per year to credit unions. It has also committed to support 1 in every 4 of Britain’s social banking customers.

This announcement falls during the week the Group revealed its full Helping Britain Prosper Plan where, for the first time, it revealed seven separate and significant public commitments to address some of the big issues facing Britain today.

Graham Lindsay, Director, Responsible Business for Lloyds Banking Group said: “Our Helping Britain Prosper Plan incorporates bold, public commitments to help address some of the big issues facing Britain today. It’s about putting customers and communities at the heart of everything we do. The Plan is not just for those customers enjoying relative prosperity, but also those facing financial difficulties. For this reason we believe our annual investment of £1m into Credit Unions is one of our most critical.”

Mark Lyonette, Chief Executive of the Association of British Credit Unions (ABCUL) said, “We very much welcome the package of support for the credit union sector as announced today by Lloyds Banking Group. We look forward to working with the Group to ensure this generous investment complements the work that is already taking place to strengthen the sector. The Credit Union Expansion Project will benefit greatly from the secondment of Lloyds’ experts and the expansion of the signposting scheme should help many more people access appropriate services from their local credit union.”

Minister for Welfare Reform Lord Freud said: “Credit unions play a vital role in helping people build up savings and have access to loans, especially those who find it difficult to have mainstream high street bank accounts. This is why we are investing £38m to help credit unions modernise and grow.

“I absolutely welcome this support from Lloyds for extra funding and I particularly welcome the commitment to send experienced banking staff to support the growing efficiency of credit unions. I hope other banks will also consider this and provide support to help local credit unions.”

Lloyds Banking Group commenced a pilot in September 2013 through 25 Lloyds and Halifax branches in the Leeds area to signpost appropriate customers to the Leeds City Credit Union and local money management charities. Over 1,000 customers to date have taken away information about these organisations.

The approach of the pilot programme, which was due to end this month, has been adopted on a permanent basis and will be expanded to a further nine UK flagship locations with the cascade of basic information becoming available through all Lloyds and Halifax branches.

Chris Smyth, Chief Executive, Leeds City Credit Union, said: “Credit Unions play a critical role. We know this from our pre-Christmas trading and coinciding with the Lloyds pilot, was 25% higher than the prior year. In this period our lending was almost £2m. This represents a terrific saving in terms of interest of £1.3m had these loans gone to a high cost lender instead.

“Our post Christmas trading during January and February is 100% up on the same period last year. We believe this is an exceptional turnaround and may indicate a serious shift in mood across our target market towards the credit union – which is great news for all.”

Lloyds Banking Group is Britain’s biggest provider of social bank accounts.

Launch of credit union service for MPs

LMCU logoA new credit union service, launched on 25 November, means that Parliamentary staff including MPs can now pay into a credit union via payroll deduction.

Agreements with the Parliamentary authorities mean that anyone working in the Palace of Westminster can now join London Mutual Credit Union and save or repay loans direct from their wages.

The initiative was launched at an event in Parliament hosted by the All-Party Parliamentary Group on Credit Unions and London Mutual Credit Union. Money saving expert Martin Lewis spoke at the launch and also became a member of the credit union.

Credit union partnerships are a cost effective way for employers to enhance the financial well being of employees and payroll deduction makes saving and borrowing easy and convenient. The Parliamentary authorities are the latest in a long list of employers to offer this benefit to their employees. Staff working for the police force, public transport employers, British Airways and the NHS are just some of the people who already enjoy the convenience of payroll deduction.

Martin Lewis said: “With the growth scourge of payday lending across the UK – credit unions are a viable, cheaper, non-profit local alternative and should be encouraged. Therefore today I hope to be excited at the launch event to see senior MPs and even Government Ministers giving the London Mutual their backing by joining up and making use of the deduction facility. It’ll be interesting to see who puts their money where their mouth is.

“This extra income for the credit union can then be lent back out to the community as affordable loans, stopping the need for many to resort to the use of high-cost credit and demonstrating the benefit to both sides of the financial equation of becoming a member.”

Damian Hinds MP, Chair of the All-Party Parliamentary Group on Credit Unions, said: “I am delighted to see London Mutual Credit Union extend its services to all of those working in and around Parliament. Partnering with employers and payroll deduction arrangements can have enormous benefits for credit union development while providing a valuable financial service to workers and employers.”

Lord Kennedy of Southwark, a Vice Chair of the APPG on Credit Unions, said: “In extending to Parliamentarians and Parliamentary staff, London Mutual will ensure that even more people can benefit from their excellent, affordable and ethical services both in Parliament and in the wider community. And I hope that in making personal use of London Mutual, many more MPs will be persuaded of the great value that credit unions generate for their members and society.”

Lucky Chandrasekera, London Mutual Credit Union chief executive, said: “It is fantastic to be launching our Parliamentary service today which is a goal we set ourselves some years ago. We hope by launching this service for Parliament that we can demonstrate the value of credit union membership on a daily basis to MPs and the wider Parliamentary staff. We have a range of competitive products and services for Parliament to take advantage of.”

ABCUL Chief Executive Mark Lyonette said: “The value of payroll deduction is not to be underestimated for all parties concerned. This high profile addition to employers offering this service is very welcome. The vast majority of large employers in the US – including the White House, Congress and Senate – offer this facility to their staff and I hope that many more will follow this example and talk to their local credit union about how they can help their employees access convenient financial services through payroll.”

Credit unions are financial co-operatives, owned by their members, which provide safe savings, affordable loans and a range of other financial services to over a million people in Britain.

London Mutual Credit Union is the largest community credit union in London. It serves over 20,000 members in the London Boroughs of Southwark, Lambeth, Westminster and Camden. Members have access to a range of savings and loan products, including the Credit Union Current Account and a cash ISA offering 3% AER.

Celebrating International Credit Union Day

International Credit Union DayThursday 17 October is International Credit Union Day and credit unions around the world, with 200 million members in over 100 countries, are celebrating.

This year’s theme is Unite for Good – a better way, which emphasises the benefits of co-operation among credit unions worldwide.

In Britain, some of the things that have been happening include:

  • The Archbishop of Canterbury sent his first Instagram message to urge people to use credit unions
  • Labour leader Ed Miliband announced plans to support credit unions through a levy on the payday loans industry
  • The Scottish Parliament held a reception for  credit unions, partner organisations and MSPs from across Scotland
  • Bishops around the country showed their support for credit unions with 39 Bishops in 29 dioceses involved in the day and over 50 credit unions being supported.

Mark Lyonette, Chief Executive of ABCUL – the Association of British Credit Unions, said: “We very much welcome the widespread support for credit unions on International Credit Union Day. People ‘Uniting for Good’ in communities and workplaces around the country means that fair and affordable financial services are becoming much more widely available through credit unions.

“It is appropriate today to thank the thousands of volunteers and staff in nearly 400 credit unions around the country who are committed to providing great value financial services. They are not driven by profit, but by the desire to meet the needs of their neighbours and colleagues.”

Credit unions in Britain look after over £1 billion in assets on behalf of over 1 million people.