General: What is Sheffield Credit Union?

It’s a savings and loans co-operative.  It provides access to safe, affordable and inclusive savings and loans options, and can also help with budgeting.  It is owned by its members and is directed by a voluntary Board with various different areas of experience and expertise. It is authorised by the PRA and regulated by the PRA and FCA.

Credit Unions are found all over the world, and are the preferred choice for financial services in many countries such as USA, Canada and Ireland. The UK doesn’t promote them as widely as other countries choose to, and their not-for-profit status means that they don’t have huge budgets for promotion.  They do work closely with partners, and rely on word of mouth to increase their membership.
(see www.woccu.org)

General: Who are its members?

Anybody who chooses to have savings and/or loans with the Credit Union. They have to fulfil one of the following criteria, pay a small one-off joining fee and keep a minimum £1 balance in their account:

  • Live or work in the  Sheffield City Region.
  • Be a tenant or employee of one of the 17 named housing associations that we work with and who operate the above region
  • Be the designated representative of a community group or organisation based within the Sheffield City Region

Members who have savings are referred to as having ‘shares’. These shares give the member a vote on what happens to the Credit Union. If a profit has been made, they can vote on how much to give back to the members as a dividend (a % of savings, just like interest).

General: What makes it different to a Money Shop, Payday lender or similar high cost lender?

Credit Unions aren’t as quick to make a loan decision, they want to be sure a loan is the right solution for the person. This means looking at income and expenditure, patterns of spending through bank statements and running a credit check. They charge less interest and the interest rate is capped by the government at 42.6%. This is charged on a decreasing balance, which means you only pay interest on the balance left when you have made your latest payment.  You can overpay, or repay early with no penalty charges.  If you are having trouble making repayments, we will work with you to keep up to date.

General: What makes it different to a bank?

Credit Unions specialise in savings and loans products, and are not-for-profit.

They do not generally provide as wide a range of services as the banks, but specialise in what they do provide to make their products as accessible as possible to as many people as possible.

Being not-for-profit, any surplus made is returned to the members as a dividend, and used to improve the services.

Sheffield Credit Union are specialists in offering loans of up to £5,000 and offer interest rates which beat most high street banks. Credit Unions generally offer loans from £100 and over, where banks would usually only consider much larger amounts.

General: Why are they a good choice for those facing financial exclusion?

Credit Unions are customer-focussed, with friendly staff who will make suggestions for sound saving and borrowing based on individual circumstances. They only allow members to borrow what they can afford. They can help a member access a basic bank account and/or debit card for convenience. Many, like Sheffield Credit Union also offer budgeting accounts, to help members handle their money, which is particularly important with the introduction of Universal Credit to individuals who may not be used to being in receipt of a monthly income.

Loans: When will my loan be ready?

Our usual decision times for assessing loan applications are 3 working days for our Starter Loans and 1 working day on our other loan products. At times of peak demand (such as Christmas) this may be longer but we will let you know at the point of application.

When you submit your loan application with the appropriate period of bank statements and any other proof of income required, an estimated time scale can be given.

Once the loan has gone through initial screening we will send you a text message with the estimated date of a decision on your application. At the end of each day our lending team will ring round to inform members of the decision on each loan where the assessment has been completed. If you have indicated that you would prefer contact by email or text message we will try to meet this request wherever possible.

Loans: What is the deadline for a Christmas loan?

Christmas is our busiest time of year for loan applications.  We usually set a deadline by which we must have received loan applications in order to guarantee that they will be assessed in time for Christmas.

The deadline is usually on a Friday, either towards the end of November or at the start of December.  Please check our website, our office displays or our telephone message for the current year’s deadline, usually displayed from the end of October.

Loans: I applied for £1000, why are you only giving me £400?

Sheffield Credit Union is an affordable and ethical lender.  As such, we have to use consistent methods to work out what size of loan is affordable for you given your income and expenditure, as well as examine your credit record and your bank statements to ensure that by providing a loan, we are not likely to worsen your financial situation.  One way we may do this is by reducing the amount we offer to you.

You may also already have a balance with us that we need to take into account before making an offer.

We may also recommend regular savings, or require you to secure some of your regularly built up savings to enable us to provide you with a loan.

Withdrawals: How quickly will I receive a payment to my bank or Engage card?

The Department for Work and Pensions may send your money shortly after midnight, but it is not possible for us to process the payments until we have staff in the office the following morning.  Processing payments is our first morning task.

Payments are credited on to accounts and the relevant bank transfers are made by 10am the same morning.

Please be aware, these transfers can take up to 2 hours to reach your account (depending on your bank).  Engage card transfers are typically much faster.

If after 12pm you have still not received your money please do not hesitate to contact us by telephone or email and our staff will do their utmost to help solve the problem.

If you have requested a transfer during the day, either in one of our branches, by calling the helpline, or via the members’ area, these will be sent after 3.30pm, and should be in your bank account or on your Engage card by around 5:30pm.

Withdrawals: How do I withdraw my savings?

Savings can be withdrawn from a share 1 or share 2 account by several methods.  Using the members’ area to enter the bank details you would like the withdrawal to be made to is one way, with no charge for this 24 hour service provided you do not use a reference (£2 charge if you use a reference).  Members may also register a bank account to their member account (via a signed BACS authorisation form) and ring the office to make a withdrawal request (£2 same day fee, free for 3 day transfers).

Savings can be withdrawn by cash (up to a maximum of £40 approximately) or by cheque cashable at a post office (£2 fee per cheque) from the main office on Commercial Street.

Secured savings cannot be withdrawn whilst a loan is in place.  Reserved savings require 24 hours notice.  Christmas Savings are non-withdrawable until after 31st October each year.  Junior savings may be withdrawn via a share withdrawal form completed by the trustee, or by registering a BACS authorisation form on the member’s account to use to make telephone withdrawals.