Nowadays, it is easy to believe that there is no other option since the standard means of having credit has become so common that being at the mercy of increasing interest rates and inflated charges on loans and credit cards has become so common. However, there is this unknown alternative which is called the credit union movement.
A credit union is being run by its members which serves as a profit sharing and financial co – operative. The credit union surely ha some alternatives which are not found in the bank that makes the client more interested, thus, statistics shows that the fame of credit union movement in UK has increased.
As maximizing profits is not the key goal for a credit union, such an organization has three main aims.
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The first goal of a credit union is to help its members save money.
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To provide loans and financial assistance to its members at the lowest rates of interest possible.
To render help and support to its members in the management of their financial affairs is another goal of the credit union.
Last but not the least, being a member will let you take the best benefits that the credit union can offer.
The secret to becoming a union member is to have a ‘common bond’. The common bond will determine a lot of factors which includes determining if you are residing in that specific area, if that so, then you are qualified to become a member of the credit union, however, you can also be qualified if you are an employer in that specific area or maybe, you are a member in a certain association or club in that area.
Thus, regardless of your employment status, age, income and credit rating, the credit union will still accept you as a member and will surely help you save money regularly. Thus, whether you are rich or poor, you can still become a member of the credit union and save a money regularly for your future plans.
The overall sum of the members’ saving can also be helpful since this can help provide low cost financial services to its members. Although each credit union (as all mutual societies) must ensure that enough money is set aside to ensure financial stability, all other profits are used to provide the lowest interest rates for members’ loans whilst returning an attractive rate of interest for its savers.
All money borrowed from or saved with a credit union must be in the name of a member and as such, no money can be borrowed in the name of your business.