Three credit unions receive Fairbanking recognition
The Fairbanking Foundation operates a certification scheme, the Fairbanking Mark, to encourage banking organisations to improve the financial well-being delivered by their products. The certification is awarded in three, four or five star versions based on Fairbanking’s assessment of the level of financial well-being the product delivers. Fairbanking’s assessment also reviews the provider’s complaints procedures and experience, as well as wider factors, such as the rates charged/offered by the product, before advising whether the Mark should be granted.
Credit Unions are member-owned financial cooperatives offering a range of financial services, including savings and affordable loan products with an emphasis on providing the best service to its members and putting people ahead of profits. Currently, less than 2% of the UK population are members of credit unions and although the sector is growing fast, it’s still very small compared with some other countries such as the US where 46% of people are members, and Ireland where it is 75%. To join a credit union, people have to fit within their ‘common bond’, which usually means living in a specified geographical area or working for a particular employer.
To receive this award, the credit unions had to demonstrate that their personal loan customers have experienced a tangible positive impact on their financial wellbeing from using the product features. These features include budgeting support, encouragement to prepay, providing support at the earliest opportunity and developing a savings habit.
Antony Elliott, Chief Executive of Fairbanking Foundation said: “Our quality mark programme is an important step in helping customers to identify products that have been rigorously tested for the financial well-being they can deliver. Crucially, it also provides a powerful incentive for financial institutions of all sizes to compete through continual improvement of their products in ways that will truly benefit their customers.
“We are delighted to award Marks to these three credit unions and we hope that this will encourage others to come forward and apply for our Mark. We are seeing strong uptake of the scheme in the market at the moment and we very much look forward to announcing further participants of all sizes as the year progresses.”
Archbishop of Canterbury, Justin Welby, said: “These awards represent an enormous vote of confidence in these credit unions, showing the service they provide is excellent as well as fair. I hope and pray that today’s awards will inspire more people to join credit unions, which have a very important role to play in making banking more transparent and fair, and in setting an example to the rest of the sector. I also hope the awards encourage more credit unions to apply for Fairbanking Marks, so that it is clear for all to see the valuable service they are providing to local communities across the country.”
