Council rallies support for Merton Credit Union

In the light of the current economic downturn, Merton Council is calling on residents to pledge their support for a Merton Credit Union through its website.
The council is working with its partners in Sutton and Croydon to develop a cross-borough Credit Union to extend the services of the existing Croydon Savers Credit Union to Merton residents. In a bid to persuade the Financial Services Authority (FSA) that there is demand for the service, the council needs to demonstrate that there is significant support from the community. If the FSA approves the extension of the Credit Union services for Croydon to include Merton and Sutton, residents in the borough will be able to take advantage of the services from autumn 2009.
Credit Union services reduce many residents’ reliance on doorstep lenders, pawnbrokers and loan sharks. It is a savings and loans co-operative which encourages people to save rather than borrow, but also provides low cost loans to its members in times of need.
Merton Council’s cabinet member for regeneration, Councillor Diane Neil Mills said: “Many people are finding it hard to manage in these increasingly difficult economic times. Having a credit union service open to Merton residents will really help many people escape the cycle of debt. We are putting the needs of residents first and ensuring they won’t have to rely on unscrupulous lenders. I would encourage people to support the creation of a credit union for Merton by pledging their support through our website.”
Members of the public wishing to pledge their support can do so at
Notes to editors
The proposed Credit Union will be a not-for-profit savings and loans co-operative that promotes saving rather than borrowing, but also provides low cost loans to its members at times of need. Credit Unions are based upon a “Common Bond” between members, which in this case will be geographic ie everyone who lives or works in Merton, Sutton or Croydon.
As a co-operative, Credit Unions have no outside shareholders so any surplus is returned to members of the Credit Union as a dividend on savings and a rebate on loan interest paid. This keeps money in the local area, helping to regenerate the local community. Many Credit Union members choose to save with Credit Unions knowing their savings are helping others to escape the debt and poverty trap. By encouraging savings rather than borrowing makes Credit Unions significantly different from other companies in the financial services sector.