Credit union loans

You could get a loan or current account from your local credit union, but need to join first.

How to join a credit union

Use the find a credit union search to see which union you could join.

Each credit union has its own rules about who can join.

Credit union members must generally have a common bond. Examples of a common bond include:

  • living or working in the same area
  • being tenants of the same housing association
  • working for the same employer.

Most credit unions are members of the Association of British Credit Unions.

Short term loans

Credit unions provide short-term loans, often for small amounts.

Credit unions may offer you a loan if you have a low income or you claim benefits. You may need to build up savings before you get a loan.

Interest charges are no more than 3% per month, but many charge less.

Use the Association of British Credit Unions' loan calculator to see what a loan could cost

Current accounts

Some credit unions provide members with a current account.

This could be helpful if you can't open a bank account with a traditional bank. .

Saving with a credit union

Credit unions encourage saving as a way to help with budgeting your money. 

Credit unions may allow you to deposit money at:

  • local branch offices
  • local shops
  • by direct debit 
  • through deductions directly from your wages.

Credit unions usually limit the amount you can save with them to a maximum of £30,000. 

Your money is protected by the Financial Service Compensation Scheme (FSCS) if the credit union fails. 

Problems repaying a loan

If you have difficulty paying your loan, you can ask your credit union for more affordable repayments or help with budgeting.

If you don't pay, a credit union can take you to court in the same way as any other lender

Need more help?

Find out more about saving and borrowing from a credit union from Which?

Last updated 08 November 2018 | © Shelter

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