A credit union earns interest on its bank deposits and short term gilt edged securities. However, it could earn a higher rate of return on the interest paid by its owner-members on their loans and repaid in regular instalments, in accordance with the terms and conditions set and agreed at outset with the credit union.

The encouragement of saving and making of loans are the real purposes of a credit union. By law, only members can save with or borrow from the credit union.

Both the maximum rate of interest to be charged and length of any loan are set by UK law, a unique feature, and fixed from time to time by its ‘Board of Management’ (Directors) who are elected from the body of owner-members.

All loans are granted in the name of the credit union after a written application is made by the owner-member to its Management.

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