What is a Credit Union?
A Credit Union is a financial co-operative that is owned and controlled by the members.
Authorised and regulated by the Financial Services Authority FRN 228814. Rugby Credit Union was registered with the Financial services Authority (FSA) in June 2004.
The Credit Union is a member of the Association of British Credit Unions Limited
How does the Credit Union work?
The members of the Credit Union pool their savings, enabling them to provide sufficient funds from which loans can be made. A Credit Union borrows money from its savers and may pay them a return on their money (dividend). The money borrowed from members is lent out to other members, who pay interest on the money loaned to them.
The Credit Union must be successful in attracting a large enough number of savers to provide a sufficient liquidity level to meet members' demands for loans, savings, withdrawals and to pay operating expenses. The main source of income for the Credit Union comes from members' loans.
The operation of the Credit Union is managed and controlled by an elected Board of Directors. All officers of the Credit Union are members, elected at the Annual General Meeting. All members of the Credit Union have one vote, regardless of the amount of their savings.
The Credit Union is registered as an Industrial & Provident Society and governed according to a set of registered rules that outline the legal identity, how we are governed and what the rights of members are. Control lies firmly within the hands of the members, through their elected representatives, the Board of Directors.
Objects and Social Goals
The rules of the Credit Union list the objects as:
- The promotion of thrift among its members by the accumulation of their savings.
- The creation of sources of credit for the benefit of the members at a fair and reasonable rate of interest.
- The use and control of members' savings for their mutual benefit.
- The training and education of members in the wise use of money and in the management of their financial affairs.