Credit unions 'growing in crunch'

13/01/2009

One part of the financial services sector is prospering in the economic slowdown: credit unions.

The community-based loan groups are even expanding at the moment, with seven more announcing last week that they would offer a current account service, the Guardian reports.

In total, 18 unions carry current accounts, encompassing 15,000 members - with the first only beginning the service as recently as 2007.

Moreover, this figure is expected to increase by 100 per cent over the next year.

Credit unions work on the co-operative model - in other words, they are run by their members, as opposed to a chief executive, a board and shareholders.

"The government is keen to see greater expansion in the sector and has said it will scrap some of the red tape restricting their growth," the newspaper added.

"Ministers have promised to radically change [the] rules so credit unions can provide their services to a wider range of people. This may also make it easier for credit unions to merge."

Tags; Debt Management and Banking, Young Family Finances, Retirement Money Problems, Recent Graduate Debt,

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