Your questions answered
A credit union is a community savings & loans provider that exists to provide financial services to a common group of members – in our case those who live or work in Ayrshire. Unlike banks and other commercial finance providers, a credit union does not operate to generate a profit - it exists solely for the benefit of its members.
A credit union is a community of its members, whose aims are to promote their financial wellbeing through savings, affordable and appropriate lending opportunities, and through the promotion of greater financial awareness. Members are the owners of the credit union, and therefore have a say in how their business is run. The pressure to generate profit for shareholder dividends is greatly reduced, and any surpluses generated by the credit union are redistributed among the members.
The structure and nature of a credit union frequently enables it to help those who are currently excluded from access to ordinary bank products. It can become a lifeline for people who may otherwise have to resort to payday loans or doorstep lending which often carry incredibly high interest rates.
Yes. We are covered by the Financial Services Compensation Scheme (FSCS). The FSCS can pay compensation to depositors if a credit union is unable to meet its financial obligations. Most depositors – including most individuals and small businesses – are covered by the scheme. In respect of deposits, an eligible depositor is entitled to claim up to £85,000.
We are also authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. This means that we meet strict conditions for trading, we are required to submit information on our financial performance to the regulators every three months and our directors and senior staff are vetted by the regulators.
All financial organisations need to know who their customers are. The level of ID we request will be the level required by the Money Laundering Regulations.
We are registered with the office of the Information Commissioner and operate entirely within the requirements of the Data Protection Act 1998. This also allows you to get copies of information we hold about you in our records.
All our board members and staff sign a confidentiality agreement and none of your details are passed outside of the credit union except with your permission or as allowed under our Data Protection Registration or where required by law. Please see our Terms and Conditions and Data Protection Policy for more information.
Members are asked to save regularly with a minimum of £1 a week, £2 a fortnight or £10 a month. This will then allow access to our Christmas and Summer Savings Accounts.
Members who are looking to borrow from the credit union are asked to save up to £200 over twelve weeks. For weekly savers this would be a minimum of £17, fortnightly £33 and monthly £67.
The minimum savings of £1 a week, £2 a fortnight or £10 a month, are required while repaying loans.
The credit union is a members’ co-operative run on a not-for-profit basis. Once operating costs have been covered, any excess income can be paid back to saving members in the form of an annual dividend, approved by members at the Annual General Meeting.
THIS IS NOT INTEREST ON YOUR SAVINGS AND PAST DIVIDENDS ARE NOT A GUARANTEE THAT THERE WILL BE *ANY* FUTURE DIVIDEND.
Call the office on 01294 557 123; we will then arrange for the funds to be paid into your bank account that day.
Savings secured against a loan are not available for withdrawal.
If you pay by standing order please contact your bank to change your payment, also inform ourselves of this change.
If you are on payroll deduction please contact ourselves.
There are many reasons why our loans are better for you than a bank loan.
This all means that you will only get affordable loans from us.
You do not need to be a saving member to be considered for a loan. Take a look at our loan types and see which applies to your circumstances.
It is worthwhile to note that our Low Income Loans are guaranteed against a benefit. This benefit should be more that the minimum loan and share payments and all benefits are considered. If you are working and receive Child Benefit or Tax Credits we can consider you for this loan product.
Loans are only granted to members of the credit union. All members must save whilst repaying their loan.
The minimum loan is currently £400, the maximum loan is £15,000.
How much you can personally borrow depends on various things like how long you have been a saving member, your payment history, whether you can afford to pay it back and how much money for loans the credit union has available when you apply.
The credit union aims to support you and at the same time protect its members’ money and we do that by assessing each application individually. It is not in our interests or yours to lend you money you can’t repay.
Interest on credit union loans is limited by law, so you will never pay more than 3% per month (42.6% APR) and many loans are much lower than this.
Take at look at our loan products to see our rates. It is worthwhile to note that unlike other lenders credit union loans are not on a fixed APR. Interest is calculated daily on the outstanding balance. This means that the more you pay or the more often you pay the less interest is on your loan. This puts you the member in control of the loan length and cost.
You may see lower APRs advertised but we recommend that you check whether the advertised rate applies to the loan amount you actually need. Often, the lowest advertised rates from major financial institutions only apply to the higher value loans and are quoted as a “representative” rate, which means that may not be the rate that you are offered. Many of our customers have reported to us that bank's offered them a loan at a much higher rate than advertised. With us, what you see is what you get.
You might find that they won’t even provide the loan amount that you need at any rate.
Also, check what you will actually pay monthly and what is included. We charge interest on the reducing balance only, whereas they might apply interest up-front on the total loan.
In addition, you build up savings so that you can pay off your loan early or, if your loan runs its full term, you have a savings balance to keep.
As we are a regulated credit union, you know that you are not paying for outside shareholders or profits. Surpluses, after operating costs and allocation to reserves, are used to pay dividends to savers.
In the same way you make payments to your savings account. This might be by cash, debit card, direct payroll deduction, standing order or through benefit payments directly to your credit union account.
Yes, we welcome extra payments at any time. You can do this by cash/debit card in the office or by making a telephone payment. Making extra payments reduces the length and overall interest on your loan.
If you leave your employer, you can still retain membership of the Credit Union; however it is your responsibility to contact us to keep us updated and to make alternative arrangements for paying into your account or repaying your loan.
Please call us on 01294 557 123 to double check what information we require.
A credit union is a local co-operative. The money it loans out belongs to your friends and colleagues and fellow members with our common bond, and therefore we must loan it out responsibly. For this reason, we need to check that you are able to repay any amount we lend to you and this is why we ask for all this information. Please note that all information provided to us remains strictly confidential.
The majority of loans, excluding Low Income, are approved over the phone. Members can either have an appointment to sign for their loan or the paperwork can be posted/scanned. Loans are processed for payments into the nominated bank account within two hours of completion.
Yes, we carry out a credit check on all loan applications. This is to help ensure we are lending sensibly and protecting the interests of all members who save with us.
The credit check will in part be used to verify the information that you provide when you apply for your loan. It is therefore vital that you accurately enter your information correctly in your application, including any other outstanding credit you may have.
Please note that the credit check is only part of our decision process.
We provide you with FREE life insurance for the amount of your outstanding loan. As with most insurance some exemptions apply; for example you may not be covered if you die of a pre-existing medical condition within 6 months of taking out the loan.
We do not provide sickness, accident and unemployment insurance.
We understand that life can be difficult and sometimes things happen that result in more month than money. We are here to help.
If you find that you cannot make your repayments please speak to us straightaway. We will work with you to come to a payment plan that fits. When your situation improves you are free to return to your original payment.
We can also signpost members to other agencies for assistance with benefits, energy or budgeting.