Would you CREDIT it?

For quite some time now the idea of a Credit Union has been suggested. This runs along the same lines as a Savings and Loans company although it is run through a community initiative to protect members savings. A Credit Union in Inverness would effectively do away with the need for other personal credit companies and money lenders.

 

So how does a Credit Union work?

One of the main aims of a Credit Union is to help members save regularly. In a Credit Union savings are called shares, you receive one share for every pound saved. You can save as little as £1 at a time, you will get an account book which shows how much you have saved. Your savings go into a common pool of money, which is then used to provide loans to other members. You can withdraw your shares at any time when the Credit Union is open, however some notice may be required. Dividends are paid yearly - as agreed by members at the AGM, and are based on the number of shares you hold (before paying a dividend, the Credit Union must settle all expenses).

Credit Loans

You can borrow money for any legal purpose, such as to pay for holidays, Christmas expenses, and to buy household goods such as beds, cookers, TV's and washing machines. Each Credit Union sets it own rules which cover points such as levels of borrowing, repayment periods and how soon after joining can a member apply for a loan. The maximum interest which a Credit Union can charge on the outstanding balance of a loan is 1% per month (equivalent to an APR of 12.68%) just compare this to what a bank or credit company would charge! To help you keep in control of your finances, you have to keep on saving at your usual amount - as well as paying back your loan. This means that you should never get "over your head" in debt.

How safe is your money?

By Law it is illegal to operate a Credit Union unless it is registered with the Registrar of friendly societies. The registrar is a government official who is responsible for making sure that the Credit Union law is not broken. The registrar can call at any time to inspect a Credit Unions books, and has the power to suspend the Credit Unions operations. Credit Unions must take out insurance to cover against fraud or theft by an office holder or employee. Credit Unions cannot be registered without this cover.

How to get involved

It can take anything from 6-12 months to get a Credit Union registered.

Willing and enthusiastic volunteers are needed to: Help spread the idea of a Credit Union for Inverness; To help organise the meetings; To help in collections for the Savings Club; To join the committee of the Study Group; To undertake training in running a Credit Union; To help raise the funds to start.

If you are interested in joining a Credit Union in Inverness the people to contact are:

Duncan Brown (01463) 225834

Joe Campbell (01463) 791643