In recent years, credit unions have seen a surge in popularity. Thanks in part to the recent banking crisis. They have a lot to say too about digital skills and inclusion.
Gary Simpson is on a mission. This quietly-spoken, unassuming, down-to-earth CEO is streamlining Britain's top credit union.
To ensure the award-winning Community First* Credit Union remains fit-for-purpose in serving the financial needs of over 40,000 of its members across Yorkshire.
We recently met up with Gary in Harrogate just before he dashed off to his PhD lecture.
First question Gary, what exactly is a credit union?
Funny you should say that. Many people don't know what we do. A credit union is a financial co-operative which provides savings, loans and a range of services to its members. It is owned and controlled by the members. One of our important objectives is to combat high-cost doorstep lenders.
Have they been around a while?
The UK's first credit union began trading in 1964. Over the last 60 years credit unions have grown to provide loans and savings to more than 1.2 million people across England, Scotland and Wales.
Credit unions have a proven track record across the world. In fact, 217 million people are credit union members in 105 different countries.
The banks are under constant public scrutiny nowadays. Are credit unions any different?
We are a great 'banking' alternative for individuals and small businesses. Each member has one vote and volunteer directors are elected from the membership, by the membership. Credit unions are owned by the people who use their services, and not by external shareholders or investors. So the emphasis is always on providing the best service to members – not maximising profits.
Membership of a credit union is based on a common bond. This can be working for a particular employer or in a particular industry, or simply living or working in a specified geographical area which could be as small as a village or as large as several local authority areas.
We are regulated by the Financial Conduct Authority. This builds trust and confidence in the way we manage our members' money.
You are currently streamlining the business. Why?
We're growing rapidly. We were originally known as the South Yorkshire Credit Union because of our geographical base in Barnsley, Mexborough and Doncaster. But, we now cover the whole of Yorkshire almost up to Newcastle. We've just opened a branch in York and are currently looking for premises in Huddersfield. So, we need to look at our core services, the resources available, how we deliver the best services to our customers, and how we present ourselves as a brand. That's why we are renaming ourselves Community First from April 2018.
You're also very supportive of digital...
Yes. We've recently worked with the UK Cabinet Office on electronic identity services. Many people on low incomes or leading chaotic lifestyles cannot get bank accounts. Government needs to identify them in order to pay the correct benefits due to them - done electronically. We can provide basic credit union accounts and help them to budget their finances better. For example, we are working closely with many local authorities across Yorkshire to help relieve some of the financial pressures people may have concerning their benefits.
Plenty of our customers are digitally-savvy with smart phones. Having the ability to contact our customers in real time allows the credit union to build new and better services. For example, through tech innovation, we are looking at other ways to make our customers’ money go further. All credit unions offer savings accounts and loans. Many offer a wide choice of additional products such as junior savings accounts, Christmas savings accounts, prepaid debit cards, insurance products, cash ISAs and in some cases even mortgages.
We're also developing new services aimed at entrepreneurs who want to start and run their own business. We want our customers to dream, believe and achieve their ambitions. If we can help them on that journey, we will.
There’s no “one size fits all” rule in credit unions, and there is great diversity in the sort of service and access points that different credit unions offer in order to meet the different range of consumer preferences and expectations.
* Community First Credit Union is the new name for the South Yorkshire Credit Union.