The Liverpool Times

And a brief history of credit unions.

Thieves in Kirkby have stolen a number of computers from Southdene Credit Union. This comes under the category of ‘robbing off your own’, which is about the lowest form of theft. The credit unions in Kirkby are run by volunteers and have helped hundreds of local people escape the loan sharks who are there to prey on anyone who falls on hard times. Hundreds of Kirkby people will have been saving all year and will be issued cheques in time for Christmas.

A laptop and two desktops were taken in the robbery on Wednesday 29th November. No prizes for guessing that they are already sold on. Needless to say, if you buy knock off stuff which is obviously second hand – you might well be buying the computers nicked from your local school. There have been a staggering numbers of thefts of computers from various educational organisations. Not that the robbers will be too keen to advertise the fact. Some people don’t care what they buy - until their own house gets screwed in or their car radio is knocked off or the kids’ bike robbed. At that point they realise that their goods are being purloined by perhaps the same lads who you got a bargain off.

Even if you get offered a boxed new laptop, bear in mind you’ll pick a new boxed laptop up for £300. Second hand laptops mainly ex corporate business stock, is piled up at the computer fairs and local businesses in Liverpool. They all have serial numbers and the windows license included. Every laptop has dozens of serial numbers which identify each computer part.

Careful with your cash!

The credit unions in Kirkby have an excellent record of being able to help local people as it teaches a back to basics approach to your money in that you put a little away each week. It teaches people the old fashioned common sense approach of being frugal, getting you into the habit of being a little bit careful with your hard earned cash.

For unemployed people and those on low incomes and pensions, this is vital. For people who are blessed with a decent wage, the same principle applies in whatever financial predicament you are in. The old saying about watching the pennies to save the pounds is as true today as it always was. As the UK government allows the banks to offer us staggering amounts of credit or money ‘on tic’, with high interest rates, more and more people are tempted to spend what they have not got. Credit Unions are singing from a different hymn book than the manager of Barclays bank. At the real bottom end of the market are a myriad of shifty credit companies operating in the U.K. who will send out bailiffs to intimidate and bully people. Needless to say, these firms see Liverpool as fertile ground. Any working class community under the financial cosh of new labour, is pretty much a hunting ground for the credit sharks.

Strict legislation applies to the credit unions. Your savings, unlike those of the FarePak robbery victims, are insured. You can withdraw your credit union money or take out a loan at the lowest rate of interest you can possibly find.

Some credit unions have extended their financial clout to being able to fund mortgages and loans for high values goods. The UK lags behind but we can look to other countries for a glimpse of how a credit union might operate in Kirkby in the future.

Irish Credit Unions

Top of the earnings!

In Ireland, the credit unions there (reported Jan 2006) held 1.8 billion Euros in members saving accounts! Recent statistics from the Irish League of Credit Unions indicate that about 2.5 million people in Ireland are members of a credit union, with over 530 credit unions in operation throughout Ireland. Government help there, and local political and community support has been key to the success story. The Irish don’t like seeing the common man and woman shackled to the banks, which is why so many communities there are host to credit unions.

Origins of credit unions

Credit unions originate from the cooperative movements established throughout Europe. Such organisations promoted the virtue of solidarity and self help and the pooling of resources. The first recorded cooperative was organised in 1844 by a group of workers in Rochdale, England. Germany also began to take onboard these ideals that workers might cooperate on matters of mutual aid. The very working class communities many of us come from were built, in part, using some of these ideals. The NHS, the decent public transport and the various utility companies which rolled out the electric and gas to almost every household in the land all came from the basic premise of mutual aid. The credit unions and the idea of pooling wealth was a part of this effort.

Hermann Schulze-Delitzsch and Friedrich Wilhelm Raiffeisen created the first true credit unions in Germany in 1852 and 1864. In 1849, Raiffeisen founded a credit society in Flammersfeld, but it depended in part on the charity of the wealthy for its support. In 1864, Raiffeisen organized a new credit union along principles still fundamental today. Instead of the poor relying on charity, the impetus was on mutual aid and self help.

Farepak vs Credit unions

The people who joined the Farepak scheme would have been better joining a credit union. The actual process is pretty much the same with Farepak customers and credit union members, both giving money in the form of a weekly payment. The difference is that Farepak customers are left with nothing this Christmas unless they are lucky.

Had the members of Farepak put their money into a credit union, the money would be safe as houses. The member of a credit union will arrange to pay in whatever they can afford, on whatever basis they agree to. If you agree to pay £1 per week, you can be flexible and pay in more if you so desire. Credit unions are local, and have various payment points, which could be further helped if the government recognised the potential. In Ireland the credit unions have high street branches and employ staff, creating jobs as well as making sure the savvy Irish are not fleeced of their hard earned Euros.

Ways in which the credit unions can be helped

Needless to say, more funding would be nice. In Kirkby, tens of millions of pounds were handed out, but the credit union, one of the most proven of the various organisations set up here, has not exactly been helped a great deal when you weigh up the decided advantages of doing so.

Top up credit cards are the next big thing. Sadly, for the poor who might be forced to set one up, you will pay more to pay for goods and services. For those who say “I’ll always use cash”, bear in mind that there are many bargains to be had online. With government funding, local credit unions could quite easily issue top up cards which are basically an extension of a Visa card, with all the security features.

Find a credit union

There is an online search facility to see if your region or area is covered.

Click here to find a credit union.