Financial inclusion

Credit unions have been central to Government work to tackle financial exclusion in recent years.

Credit unions are actively engaged with providing inclusive financial services in the following ways:

. Affordable credit and safe savings - Credit unions strive to provide their services to everyone in their 'common bond'. Because they provide a range of loan products, including small, short term loans, they provide an affordable alternative to high-cost lenders who might charge interest between 200% and 1000% APR. Credit Unions can, by law, can charge no more than 2% a month on the reducing balance. This equates to an APR of 26.8%.

Credit unions also provide safe and convenient savings facilities, including savings account for children and young people and special accounts for Christmas. Convenient ways to save such as through payroll deduction or deduction from benefits means that members do not miss the funds paid into their savings.

. Financial Inclusion Growth Fund - Administered by the Department for Work and Pensions, the Growth Fund has provided almost £100 million in capital for on-lending to those most in need of affordable credit. 90% of this has been provided through credit unions.

. Credit Union Current Account - Developed by ABCUL, 9 of our largest members and the Co-operative Bank, the Credit Union Current Account (CUCA) is now provided by 24 credit unions. Designed to overcome many of the disadvantages of some Basic Bank Accounts, account holders use a VISA debit card, the LINK ATM network and direct debit to manage their cash. Large default charges which can put many people off using direct debits - and benefitting from reductions in utility bills as a result - are avoided, with a transparent fee structure sometimes charging a small fixed amount each month or week.

. Saving Gateway - Credit unions are keen to provide Saving Gateway accounts when they are rolled out from July 2010. The scheme provides a 50p match payment for every £1 saved as an incentive to kick-start a savings habit amongst those on welfare benefits and in low-paid employment.

ABCUL: Credit unions welcome progress on legislation

ABCUL – the Association of British Credit Unions – has welcomed steps taken in Parliament this week which will see increased access to safe and ethical financial services in communities and workplaces across the country.

Credit union delight at £73 million Government boost

Mark Lyonette, Chief Executive of ABCUL - the Association of British Credit Unions, has welcomed today's announcement that the Government is investing up to £73 million in credit unions over the next four years, and that the Post Office could play a central role in delivering credit union services.

ABCUL: Now there's an easier way to find your local credit union

Around 80% of people in England, Scotland and Wales can join a credit union because of where they live, work or the organisations they're members of, and this is growing all the time. Now there's one place where they can find out about the credit unions they can use.

ABCUL: Credit unions welcome Post Office plans

ABCUL - the Association of British Credit Unions - has welcomed today's policy statement from The Department for Business, Innovation and Skills (BIS) on its plans to secure the long term future of the Post Office.

ABCUL: Credit unions can help increase diversity in financial services

Speaking at a fringe event at the Conservative Party Conference, Mark Lyonette explained how credit unions now serve nearly a million people in England, Scotland and Wales and sought reassurance from Financial Services.