Why save or borrow through a payroll deduction scheme?
If you work in the public sector or with a larger employer in Wales then the chances are you’re eligible to save or borrow with a credit union as a perk of your employment.
There are more than 140 organisations in Wales that have become payroll partners with their nearest credit union including local authorities, health boards and housing associations.
Those 140-plus employers recognise that supporting the financial well-being of their staff is good for them, good for the community, and good for business, because financially secure staff are less like to suffer money worries and related stress.
This is particularly the case at a time when household debt is rising. According to the TUC, UK households now owe an average of £15,385 to credit card firms, banks and other lenders.
As financial cooperatives credit unions promote the habit of saving as a way of securing a firm financial foundation for its members who, as shareholders, have a say in how the organisation is managed and run.
Regularly putting aside even money, however big or small, helps create a saving pot either for a special event like Christmas or a special holiday or as a buffer against unexpected bills and rainy days.
A benefit of payroll saving is that you set the sum you want to transfer to your credit union savings account and it’s transferred direct from your salary, before you can miss or spend it.
Those savings also benefit others as they are used to provide low-cost, affordable loans.
We all need to borrow money from time to time, so as an employee of a credit union payroll partner, you can access affordable loans as part of your benefits package and make repayments direct from your salary.
Credit unions not offer very competitive rates of interest on personal loans but interest is charged on the reducing balance of the loan.
You are also unlikely to face hidden charges or penalties for repaying the loan early, and many include free life insurance at no extra cost.
So find out if your employer is a credit union payroll partner and take advantage of the many financial products available to you as a member of the workforce.
- Credit unions are governed by the Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) so savings are protected up to £85,000.