Business

Duchess of Cornwall praises credit unions

The Duchess of Cornwall Image copyright PA

The Duchess of Cornwall has said she believes credit unions could be a "real force for change" in the financial services industry.

The Duchess said credit unions could "bring in from the cold" those who were unable to obtain traditional loans.

She added that they offered a "friendly financial community" for their members.

Her comments came in a speech to industry experts at a Clarence House event to mark International Credit Union Day.

The Duchess said: "Credit unions serve people, not profit. They provide a friendly financial community where members mutually benefit from advice, as well as savings accounts and loans."

UK Credit unions hold more than £1.1bn worth of assets and have more than one million members.

They operate as mutual financial co-operatives that take deposits and give loans to members.

The sector is still relatively small in the UK, compared with countries like the US where credit unions serve around one third of the country's population.

The Duchess said she believed credit unions could "change the way we talk and think about savings and loans." She added: "They can encourage those who have the means to save, and bring in from the cold those vulnerable people who struggle to qualify for loans."

And she said: "I do believe credit unions could be a real force for change in the financial landscape and are truly a cause worth championing."

The maximum any credit union charges is 3% per month on a reducing balance, which would accumulate to 42.6% over a year.

Mark Lyonette, chief executive of the Association of British Credit Unions Limited (Abcul), said: "We greatly appreciate the support she continues to give to the movement, and welcome this event which will bring the credit union message to a new audience.

"Credit unions are attracting support from a number of high profile backers as more and more people recognise the valuable service they can offer to people from all walks of life."

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