The Unique Benefits of Being A Credit Union Member
Did you know that credit unions are uniquely different to other financial institutions? There is one very important difference; credit unions are not-for-profit.
That’s right – credit unions exist only for the benefit of the people who use the credit union, called the members of the credit union. Credit unions are not motivated to make profits for the stock markets or shareholders. They only strive to make a surplus so they can either return this surplus to their members in the form of a dividend, or a loan interest rebate for those members who have loans with the credit union. Or, they might re-invest the surplus in the credit union to improve and enhance facilities, products and services.
Every credit union is run independently, so each credit union makes its own decisions at a local level. The services and products offered by each credit union are tailored specifically to suit the best interests of their members, and so services might vary from credit union to credit union.
All credit union members however will receive a range of benefits – some not offered by any other financial institutions. Read on to find out the top advantages to being a credit union member.
Nomination of Accounts
Never heard of it? Well that’s because it is a unique facility offered only by credit unions! Members over 16 years of age can nominate who will receive the money in their account when they die. Having a nomination means that the money left in a members’ account in a credit union (up to a maximum of €23,000 in Republic of Ireland or £10,000 in Northern Ireland) will not have to pass through the sometimes timely probate or intestacy process, and will go straight to your ‘nominated’ person.
Loans and Savings Are Insured
A member’s loan and/or savings in the credit union are insured at no direct cost to them. Loans are insured by the credit union’s own policy. This means that in the event of a borrower’s death, their loan will be paid off, and will not fall to their family to pay. (Subject to terms, conditions and eligibility criteria).
Flexibility with Loan Repayments
Credit unions are very flexible when it comes to loan repayments. This means that if a member finds they can pay back the loan faster than originally thought, they are free to do so without any penalties or additional costs. Similarly, if the member finds that their financial circumstances have changed and they can no longer afford the loan repayments they had originally agreed to, the credit union will work with them to restructure the repayments in a way that better suits their new circumstances. As an added bonus, there are never any hidden fees or administration charges with a credit union loan. You can find out more about the great range of affordable loans on offer here.
Credit unions will always consider every loan application individually, and will take the time to hear your story, and all of the reasons behind the loan. Credit unions will not automatically refuse a loan application from a person in receipt of social welfare, or who may not have the best credit history. They will work to see how they can help the person. In addition, a number of credit unions around Ireland are signed up to the Personal Micro-Credit Scheme (It Makes Sense loan) which is specifically designed for people receiving social welfare. You can read more about the scheme here.
Your Community Benefits Too
Your local credit union is committed to supporting and developing your local community. Credit unions will use the funds available to them to sponsor and/or donate to local youth initiatives, charities, sporting clubs and cultural events. Many credit unions also offer bursaries or scholarships for students to ease the financial burden associated with third level education costs.
With benefits like these, it’s little wonder there are 3.6 million credit union members on the island of Ireland!