Money Matters: Why credit unions can be a great option for saving and borrowing
In this week's Money Matters column, Dan Bebbington, Wrekin's debt and energy manager, highlights the advantages of saving and borrowing with a credit union.
Watch more of our videos on ShotsTV.com
and on Freeview 262 or Freely 565
When it comes to financial services like taking out a loan or looking to set aside savings, one option often overlooked is credit unions.
Unlike traditional banks, credit unions are member-owned and not-for-profit, meaning they are run by the people who use them. This unique structure makes credit unions a strong choice for both savers and borrowers, often offering better interest rates and a more personalised service.
Credit unions are especially beneficial for those who may struggle to access credit through mainstream banks. For individuals who might otherwise turn to high-interest payday loans or doorstep lenders, a credit union can provide a more affordable and reliable alternative.
At their core, credit unions function like community savings pools. Members deposit their savings, which are then loaned out to other members.
Because credit unions are typically smaller and more locally focused – often tied to a specific region, employer, or organisation – they can be better placed to understand and meet their members’ needs.
As a member, you’re not just a customer but a stakeholder, with a say in how the credit union is run.
Credit unions are committed to responsible lending and will only allow you to borrow what you can afford to repay, ensuring you don’t end up in financial difficulty.
Another key benefit is their focus on financial education. Credit unions empower their members to take control of their financial futures by providing resources that encourage stability and independence.
They also generally offer lower fees and higher savings rates compared to traditional banks. Without the pressure of generating profits for shareholders, any surplus is typically reinvested into the community through better rates, lower fees, and sometimes even dividends.
Several credit unions operate in our area, including Just Credit Union, which serves Shropshire and Telford & Wrekin, and FAIRshare Credit Union, which covers Shropshire, Telford & Wrekin, and South Staffordshire. Fusion Credit Union also serves parts of Staffordshire.
For more information, you can contact these credit unions directly or visit Citizens Advice.
Wrekin Housing Group customers who are concerned about their personal finances can reach out to our Money Matters team for support.
