Credit unions, although not widely publicised, are an alternative to banks, building societies and doorstep/payday lenders.
They offer a range of savings accounts, current accounts and loans to their members.
A credit union is a form of co-operative. It's "run by the members, for the members".
Credit unions are not-for-profit, and are formed by people who have something in common. This 'common bond' could be the same:
You can only join a credit union if you meet its eligibility criteria. Usually this means that you must share the same common bond with the other members.
In 2012, credit unions became free to extend their memberships beyond those that have a common bond, but you should still check eligibility criteria as this is a choice, rather than an obligation.
Credit unions are authorised and regulated by the Financial Conduct Authority (FCA), meaning that they are also covered by the Financial Services Compensation Scheme (FSCS).
The FSCS will protect the first £85,000 that each individual has with a credit union.
Broadly speaking, credit unions offer three main types of financial product: current accounts, savings accounts and loans.
Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.