Who can join?
Partners and family members can also join, as long as they live at the same home address.
How does the credit union work?
It is a democratic, financial co-operative.
- it provides savings and loan services
- it is not-for-profit
- it is owned and controlled by its members.
Members’ savings are referred to as shares, each having a value of £1 each. These shares are then pooled and loaned out to other investors or invested in other financial institutions.
After administration costs are deducted and reserves are established, any surplus is distributed back to the members as a dividend. By restricting membership, the original Credit Union principle of mutual self-help is preserved.
Is there a membership fee?
A one-time membership fee of £5 is payable by all new Credit Union members – this amount will be deducted from your first payment.
Can I make cash payments?
Because we are a national credit union, it is not possible to deal with cash transactions. Therefore we offer two alternatives for payment:
- by completing the direct debit form, we will automatically withdraw the agreed amount from your bank account on the first of each month
- we also offer monthly payments by payroll deduction. To make this service viable, we require a minimum of five members in an organisation who have prior approval from their payroll department. Once this is obtained, the Credit Union will liaise directly to enable this service to proceed.
Any loans granted are paid directly into the bank account nominated in your application form or subsequently amended in writing.
What can I borrow money for?
For any purpose you require funds for. For example, household goods, holidays, Christmas expenses, car repairs, bill payments, redecoration, special occasions or emergency assistance.
How much can I borrow and what’s the repayment period?
You can borrow up to three times your savings balance, up to a maximum of £5,000, and over a three year repayment period. All loans are granted at the discretion of the credit committee.
How soon can I take a loan?
You have to be a member of the SCVO Credit Union for three months before you can apply for a loan. We also have a policy against the use of share loading, which is the deposit of a lump sum to increase the savings balance simply in order to increase the amount that can be borrowed.
What are the repayment costs?
Under the law, credit unions are restricted to a loan rate of 1% per month on the reducing balance. That works out to a very modest 12.68% APR.
It is the SCVO Credit Union policy to strongly encourage a savings habit even during a loan repayment period.
Who manages the SCVO Credit Union?
Management of the SCVO Credit Union is by a volunteer board of directors who are elected at the annual meeting by fellow members. The credit committee, who deal with loan applications, and the supervisory committee who audit the operation, are also elected by members, under the one member, one vote system
Do I get a dividend on my savings?
When the Credit Union achieves the level of income from loans for all expenses to be paid, any surplus is divided between reserves and a dividend payment. The amount is decided at the AGM in line with our not-for-profit philosophy.
Are my savings protected?
It is a requirement of the Credit Union Act 1979 that all credit unions have a bonding insurance to protect members’ savings from fraud and dishonesty. Savings protection is also provided by the Financial Services Compensation Scheme up to the individual limit of £85.000.