Church credit union aims at fair finance for its members

By staff writers
January 10, 2015

Fair returns to savers, fair interest rates on loans and the aspiration to be a flagship credit union are among the aims of the Churches' Mutual Credit Union Ltd (CMCU).

The new venture received formal authorisation from the regulatory authorities at the end of last year, after scrutiny undertaken by the Financial Conduct Authority and the Prudential Regulation Authority.

The Churches' Mutual Credit Union plans to begin to offer its services to those eligible for membership from February 2015, it reports.

CMCU has been formed for and with the help of the Church of England, the Methodist Church of Great Britain, the Church of Scotland, the Scottish Episcopal Church and the Church in Wales.

The company's president, Canon Antony MacRow-Wood, explains: "CMCU will help many, even in its first year of operation and, in due course, it should become a significant financial resource to the church and individuals throughout England, Wales and Scotland. CMCU will enable a virtuous re-cycling of money within the church community, through a combined portfolio of savings and loan products."

At first, only churches and certain church individuals (ordained ministers, licensed lay ministers, elders, employees and trustees of churches and church charities and the charities themselves) will be able to become members and benefit from the financial products – leading to criticism from some quarters that the churches are mainly interested in "looking after their own".

It is estimated that at least 60,000 individuals plus churches and church charities will be eligible to join CMCU. The Financial Services Compensation Scheme covers deposits up to £85,000.

CMCU plans to offer "a range of loan products which will be a major funding stream for the dividend that will be paid on savings products such as ISAs, instant access and regular (monthly) savings accounts. These products will include a competitive car loan scheme."

Once the credit union has built up an established track record it is intended that CMCU will be open "to all church members and extend its denominational base."

This would require permission from the regulators to alter CMCU's common bond (the definition of those eligible for membership).

"CMCU aspires to become an example of best practice in the sector and aid the Church's involvement in a critical area of national life for renewal and transformation", says a news release from the sponsoring churches.

* Canon MacRow-Wood in an interview recorded earlier this year: https://soundcloud.com/the-church-of-england/the-church-of-england-launc...

[Ekk/3]

Although the views expressed in this article do not necessarily represent the views of Ekklesia, the article may reflect Ekklesia's values. If you use Ekklesia's news briefings please consider making a donation to sponsor Ekklesia's work here.