There’s no doubt about it life has been tough for many of us.
In the last few years we’ve had a covid pandemic, lockdown, overburdened NHS, witnessed a war on the TV, a living-cost crisis, death of the monarch, a new prime minister and that’s just the things off the top of my head. The future isn’t looking rosier either with the threat of a “twindemic” with both covid and flu cases on the rise, energy prices going up, food and travel prices going up and in between all of that we’re supposed to celebrate Christmas?
But it’s not been all doom and gloom all of the time. Some of our members have taken the opportunity to learn new skills as they have used the time to question some of the career and relationship choices but for many with the continuing news of further cuts to services, inflation and interest rates continuing to rise many credit unions have seen membership increase but why?
The simplest answer is because there’s no choice. With banks refusing to lend money to people including many loan offers being withdrawn from the market people have been left little choice. This is where credit unions have thrived. By helping people that banks refuse and by doing so have been able to help people get out of debt with the banking model of saving when you borrow. But how does it all work?
Credit unions, whilst similar to banks, focus more on the community side of things and provide an ethical way of borrowing. If you’ve ever applied to a bank for a loan and been refused because of a low credit score you’ll understand how frustrating this is. But this will likely be a computer looking at figures and credit scores and making a decisions. Credit unions like Wave Community Bank, on the other hand will first look at affordability and will take into your credit score into account won’t necessarily base the decision on that alone. The decision to accept or reject a loan is based on the holistic picture of the person by another person and will at best try to lend something even if it’s not the full amount.
But credit unions don’t leave it there..
The slogan for credit unions that we used at Wave Community Bank is about ‘Turning borrowers into savers’ and how that’s done is quite unique.
When you’ve had your loan accepted and make repayments onto your loan you will also agree to pay an amount into a new savings account which will be opened for you. This money is kept as collateral against your loan until it’s been paid off. And when you’ve paid off your loan in full you will be given this money which you can either spend or keep in your savings account for a rainy day.
By this time you have already proven that you can spend so much money each month for loan that many members continue to keep paying this money into their savings account in order to build it up as once you’ve started saving you’ll understand why it’s good to have something back just in case you need to use it one day.
Do something good for your money today by choosing your local credit union. If you’ve had a loan offer from a bank let us know as we will even match your loan rate in order to help you save money when you borrow.
