Ethos Public Relations Manchester

Credit unions must collaborate to fulfil their potential

by Ethos public relations

Delegates and guests at the summer reception of the All Party Parliamentary Group on Credit Unions at Westminster Abbey heard how the credit union sector must collaborate to fulfil its potential in Britain.

Rt Hon Iain Duncan Smith MP, Secretary of State for Work and Pensions, and Deanna Oppenheimer, Vice-Chair Barclays Global Retail Bank and Chief Executive UK Retail Bank & Western Europe, joined representatives and supporters of the British credit union movement at the event organised by the Association of British Credit Unions (ABCUL) and supported by Barclays.

Credit unions around the world have shown that, to be successful, they need to serve a broad range of consumers and not just those on the lowest incomes. To achieve this, in many parts of the world credit unions collaborate to deliver a wider range of services and provide the consistently high quality of services necessary to attract a mix of members.

Thanks to funding announced by Barclays two years ago, ABCUL has been able to pilot a number of back office services between credit unions, to demonstrate a business case for greater collaboration in the sector.

Secretary of State for Work and Pensions Iain Duncan Smith said: "This country lacks a savings culture and it lacks the strong institutions that people on low incomes rely on for fair credit. We know that debt is a key driver of poverty and can make it difficult for people to hold down jobs or build stable homes. And for far too long doorstep lenders and dishonest operators have been plaguing the homes of vulnerable people, who often have no other way to get cash when they need it most.

"This is exactly why we need credit unions to be supported and strengthened. We’re making a £73 million fund available that will support suitable credit unions to expand and become financially sustainable, helping up to one million more people access clearer and fairer credit. People need to have a local, trusted organisation to turn to when they are in financial need, not high cost lenders or local loan sharks, so we are doing everything possible to make sure they have that opportunity."

Deanna Oppenheimer added: “Credit unions provide an important range of financial products and play a vital role in tackling financial exclusion in the UK. Barclays is committed to supporting credit unions to build scale and capacity to help the sector grow and reach more people access financial products.” Deanna Oppenheimer recently took up the position of Chair of the Project Steering Committee, which is leading a Department for Work and Pensions feasibility study on future funding for the credit union sector.

“Here in Britain we need to make sure our offer to potential members is accessible and attractive enough for a wider range of people to join,” explained ABCUL President Antony Macrow-Wood. “Collaboration is about more than using a common banking platform, although we do need that. It’s about a change of culture; it’s about looking for benefits in collaborating in all areas of operations.”

There are now over 130 members of the All Party Parliamentary Group (APPG) on Credit Unions. Damian Hinds MP, Chair of the Group, said: “We are using our collective voice to help ensure that credit unions get the legislative environment they need, so that the collaborative approach we are calling for can make a real difference to the millions of people on low and moderate incomes in Britain.”

The Barclays Community Finance Fund award winners were announced at the reception. The successful recipients were Clockwise Credit Union, London Mutual Credit Union, Women’s Enterprise, Employment and Training Unit (WEETU), London Rebuilding Society and South Tyneside Credit Union.

The reception marked part of the credit union sector’s contribution to the Co-operatives Fortnight celebrations which run from 25 June to 9 July.

To read Iain Duncan Smith’s speech in full, visit the DWP website: http://www.dwp.gov.uk/newsroom/ministers-speeches/2011/28-06-11.shtml.

To read other news from ABCUL click here.

Posted at 30^th June 2011