Credit union partnership will improve the financial resilience of Scotland’s workforce

April 11, 2018

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Five innovative Scottish credit unions are working together in a new partnership with the Carnegie UK Trust to help workers in Scotland benefit from credit union membership via their employer.

1st Alliance (Ayrshire) Credit Union, Castle Community Bank, East Kilbride Credit Union, Kingdom Credit Union and West Lothian Credit Union are working with the support of the Carnegie UK Trust to appoint their first ever shared Employer Engagement Officer.

The new staff role, employed by East Kilbride Credit Union, will work across the five credit unions. The ambition will be to significantly increase the number of Scottish workers being offered credit union payroll deduction as a workplace benefit. Payroll deduction is a valuable part of the credit union offering which allows employees to save money and repay loans at competitive interest rates into a credit union account directly from their salary. Saving via payroll deduction helps people to save more and build a buffer to cover unexpected expenses. The ability to access a responsible source of credit and repay loans in affordable payments can mitigate the need to borrow from high cost commercial lenders.

For employers the benefit is that they are providing an easy to administer, low to no-cost saving facility for their employees to help them manage their finances, alleviating money worries among staff and contributing to a happier, more productive workforce. For credit unions, automatic payroll deduction is a safe and effective way for unions to offer and recoup loans and can significantly enhance a credit union’s membership, savings and loan book. At present however, awareness of this fantastic workplace benefit remains low. The Employer Engagement post provides a unique opportunity to support more employers to engage with the credit union offer. This two-year pilot will seek to increase the number of employer-credit union partnerships, as well as encourage more innovation and collaboration across Scotland’s credit union sector.

The Very Reverend Dr John Chalmers, Chair of the Carnegie UK Trust’s Affordable Credit Action Group, said:

‘Credit unions are a key source of support for people who might otherwise be drawn to high cost lenders to start saving and to borrow affordably. Their wide range of affordable products can help more of us, from all different walks of life and income levels, to get on top of our finances. Scotland’s credit unions have been making a difference individually for many years. Working together in this way will mean even more of Scotland’s workers can benefit from credit union membership. We are very pleased to support this collaboration and we congratulate the credit unions involved on their initiative.’

Click here to view and apply for the Employer Engagement Officer role.

Notes to editors

A credit union is a not for profit, financial co-operative body, owned and controlled by its members. It seeks to encourage the habit of saving, offering savings accounts but also personal loans at attractive interest rates. The Carnegie UK Trust’s Gateway to Affordable Credit report recognises that credit unions have a vital role to play in supporting people to build a savings habit and access affordable credit.