Credit Union proves a lifeline in tough economic climate
by Hammersmith and Fulham Press Office
09/12/2008
Britain's "buy now, pay later" credit card culture has led to unprecedented levels of personal debt. The average Briton now has more than twice as much unsecured borrowing - including overdrafts, personal loans and credit card debt - as the typical European.
In fact, Britons have racked up so much debt on loans and credit cards that the total borrowed now exceeds the entire value of our economy. Overall, individuals owe the staggering sum of more than £1,500,000,000,000. Even before mortgage borrowing is taken into account, the average Briton owes £3,175, compared to the average debt in Europe of £1,588.
But despite this gloom, help is now at hand for residents of Hammersmith & Fulham now that a credit union has opened its doors in Fulham. H&F Credit Union, based on North End Road, Fulham, serves anyone who lives or works in the borough.
H&F Credit Union, partially funded by the council, is a bank with a difference. A credit union is a financial institution that is co-operatively owned and controlled by its members. Credit unions differ from banks and other financial institutions in that the members who have accounts in the credit union are the owners of it.
This means that residents can access straightforward, value for money financial services from an organisation that is managed locally, operates ethically and on a not-for-profit basis.
Unlike high street banks, credit unions do not make a profit for a small number of management shareholders. With the credit union everyone is a shareholder and everyone gets a share of the profits by way of an annual dividend.
Speaking about the opening, Stephen Greenhalgh, Leader of the Council said: "Personal debt is often the pathway to poverty for many people and is one of the most serious social problems facing us today. This council wants to encourage a savings culture rather than the prevailing "buy now, pay later" credit card economy. The credit union will be a great place for savers and also means that our residents can now access straightforward, value for money financial services from an organisation that is managed locally and operates on a not-for-profit basis.
"This really is great news for our residents as Hammersmith & Fulham strives to become your Borough of Opportunity. I have already joined the H&F Credit Union and am now a fully signed-up member. I am sure
many other people will be doing likewise soon. "
A group of dedicated volunteers have been working to set up H&F Credit Union for almost five years. They have been supported by Hammersmith & Fulham Council, who provided £25,000, North Fulham New Deal for Communities, Notting Hill Housing, a number of other housing associations including Southern Housing and Guinness Trust and the Urban Partnership Group. In addition almost 2,000 local people have pledged their support to the creation of H&F Credit Union.
And at a time when High Street banks are slow to pass on interest rate cuts to customers and with the credit crunch continuing to bite, H&F Credit Union has already proved to be very popular with a number of people who were given the opportunity to save with it during its development phase.
Jenny Kyle, 30, works for Notting Hill Housing in Hammersmith and is one such lucky person. She said: "I think H&F Credit Union is an excellent idea and I urge all people to consider joining it. I have been saving at there during its development phase and it has been very useful indeed. Before I joined I'd never really thought about
saving money but H&F Credit Union has meant that I have been able to save a little bit every week. I have now saved enough to return home to New Zealand for Christmas which is really amazing."
Nicky Mitchell, 31, works for Notting Hill Housing in Hammersmith. She said: "The credit union really is an excellent way of saving. I have been doing a Christmas saving scheme whereby a small amount of money is taken straight out of my salary and put into my account. I have been able to save quite a lot of money for Christmas that way and I haven't really noticed the money leaving my account. I think that credit unions will increase in popularity in this country. They are particularly useful for people who do not have a bank account or
who may want to get a loan with a reasonable interest rate and do not want to go to the loan sharks. I will definitely be doing another Christmas saving scheme for 2009. "
In the UK credit unions provide credit for only 1 per-cent of the population. However, the credit union concept seems to be gaining popularity and is now the fastest growing part of the financial services sector. Worldwide, there are more than 42,000 credit unions with over 160 million members
Vincent Thomas, Chairperson of H&F Credit Union, said: "I am absolutely delighted that H&F Credit Union is now open. A lot of people have been working for a long time to get the credit union to this point and I am sure that it will have a great impact for many people throughout the community. "
Anyone interested in saving with the credit union or finding out about loans, volunteering or becoming a director can contact Eugene Waters on 020 8357 4587 or log onto the credit union website www.hfcu.co.uk. You can also visit the Credit Union at 274 North End Road, Fulham, SW6 1NJ or email info@hfcu.co.uk.
