Glenrothes Area Committee
25 May, 2011
Agenda Item No. 11
Credit Union Development
Report by: Joe Fitzpatrick, Head of Local and Community Services
Wards Affected: 14,15 and 16
This report illustrates progress on the targets set for increased Credit Union membership
set out in the Credit Union Development Plan 2008-11 and provides an update on new
The Committee is asked to:
Agree support from the Glenrothes area Budget with lease costs for Glenrothes premises
for the 18 months. Note the positive progress being made to develop and support
Kingdom Credit Union and the annual increases in membership.
Lease until January 2013 £7,500
Planning Permission £ 319
Rates £ 0
Solicitor Fees £ 400
Service Charge £1200
Legal & Risk Implications
Policy & Impact Assessment
1.1 Credit Unions are owned and managed by their members and have an
important role to play in combating financial exclusion. They provide access
to loans with competitive interest rates and encourage saving, which can
provide a long-term way out of money problems. Kingdom Credit Union
commenced operations in September 2004 as Glenrothes and Levenmouth
Credit Union, they later extended their common bond to cover central Fife
and changed their name to Kingdom Credit Union at that time.
2.0 Issues and Options
2.1 It is very encouraging to see in attached Table 1 and the bar chart in
appendix 1 that membership of Kingdom Credit Union has increased
dramatically over the years. The current membership of 2817 includes 2435
adults and 382 juniors.
The number of members from the Glenrothes area is 534
The number of members from the Kirkcaldy area is 486
The number of members from the Levenmouth area is 1723
The remainder from other areas of Fife who have joined due to working in the
central Fife area.
The above breakdown reflects the shop front premises Kingdom have in
Methilhill. Shopfront premises have proved throughout the UK to lead to
greater membership numbers.
2.2 Kingdom operates savings clubs within 6 primary schools including Leslie PS
and Tanshall PS. These savings clubs have been established within schools
to encourage children to get into the habit of saving from an early age and
hopefully move the next generation away from the credit culture which has
developed over a number of years.
2.3 Since June 2009 Kingdom has been providing growth fund loans in
partnership with Capital Credit Union in Edinburgh and the DWP. This project
enables Kingdom to offer immediate loans to those on benefits or low
income. To date Kingdom have approved 2627 of these loans to a value of
£1,023.615 with a bad debt write off of 2.5%, one of the lowest in the UK.
The interest charged by Kingdom on these loans is £95,940 had the same
amount been borrowed from doorstep lenders the interest would have been
£820,000 resulting in a saving to the community of £724,000. There are
currently 920 Growth Fund members, 84 of whom are in the Glenrothes area.
Two open days have been held in Glenrothes to promote these loans, one at
the Exit Centre on Thursday 12th May and one at the Collydean
Neighbourhood Centre on Monday 9th May. 34 new members were signed up
on these days and it is expected that membership will continue to increase
from these areas.
2.4 Other services Kingdom CU offer are:-
A pre paid debit card. This enables members to have benefits, savings or
loans transferred onto a debit card enabling them to purchase products by
telephone or on the internet and to use in shops rather than carrying cash.
There is a 50p fee to load this card but no charge for use.
Money Guidance and budgeting support. Until March this year this post was
funded by the Coalfields Regeneration Trust. Kingdom is now working in
partnership with CARF to continue the service.
Internet access. Kingdom now has its own website kingdomcu.co.uk.
Members can register online for a password and then access their credit
union account. Various other forms are available to complete and submit
online including loan application forms.
Death Benefit. If a member dies any outstanding loan is written off by the
credit union and any savings held up to £2,000 are doubled and paid to the
member’s next of kin.
Payroll Deduction. Employees of Fife Council, Mgt, Donaldsons Timber, Fife
Gingerbread and Home4good can now have payments deducted directly
from their salary and paid into the Credit Union.
3.0 FIFE COUNCIL SUPPORT
3.1 The Fife Forum and individual CUs are supported by the CU Development
Officer and the Credit Union Development Assistant recruited in August
2009. The assistant is focusing on schools development and it is expected
that the recent increased activity within schools will continue.
3.2 The credit union development officer has a budget of £40,000 awarded from
the Fairer Scotland Fund for Credit Union Development. This funds staff at
Benarty and Lochgelly Credit Union and Kingdom Credit Union as well as
Fife wide marketing and training.
3.3 Generally Fife Council Services offer free support such as use of meeting
rooms, photocopying, and access to telephone facilities etc.
Support is not currently required for Rates Relief, the Small Business Bonus
Scheme awards 100% rates relief for the value of property currently
occupied by Fife Credit Unions.
4.0 FUTURE DEVELOPMENT
4.1 Due to the high uptake of membership in Levenmouth, Kingdom is now
planning to open shop front premises at 9 Albany Gate, Glenrothes. The Co
operative who currently hold the lease for these premises until January 2013
have accepted an offer of £5,000 per annum 50% of the rate they are
currently paying. Planning permission for change of use has been submitted
and it is hoped to open this branch by August at the latest. The rateable
value of these premises along with that of the premises in Methilhill are still
below £10,000. Kingdom will therefore still be entitled to 100% small
business rates relief.
4.2 The Credit Union Accounting Software producer Conaccess has merged with
Electronic Channel financial Services in Dublin who provide services to the
more advanced Irish Credit Unions. This merger has enabled Kingdom to
offer the e-web online account allowing real time access to account
information. Kingdom hope, in the near future to upgrade to the e-web online
transaction system which will have the ability to post transactions online, pay
bills and buy mobile top ups etc.
List of Appendices
1. Kingdom Membership Figures
2. Savings and Loans
3. Interest Comparison Table
Credit Union Development Officer
Fife House, Glenrothes
Telephone: 08451 555555 + 441243
Email – email@example.com
Kingdom Credit Union Membership
Year 2004 2005 2006 2007 2008 2009 2010 2011
Total 46 171 306 568 794 1432 2388 2817 (to
% Increase 270% 79% 85% 40% 80% 62% 18%
2004 2005 2006 2007 2008 2009 2010 2011
Membership, Savings and Loans Figures
Adult Members Junior Members Loans Loans
Credit Union Savings Savings
2009 2010 2009 2010 Sept 2009 Sept 2010
Glenrothes Area 296 517 11 55 £38,509 £129,570 £16,183 £69,953
Total Kingdom 1404 2063 180 348 £378,760 £574,225 £204,123 £441,697
LOAN COMPARISON TABLE
Loan Weekly No of Total Amount Total Charge
Amount Payment Weeks Payable for Credit
Credit Union £500 £10.25 52 £532.80 £32.80
LoansAtHome4u.co.uk £500 £16.65 52 £866.65 £366.65
Morses Club Ltd £500 £17.50 50 £875.00 £375.00
Shopacheck Financial Services £500 £17.50 50 £875.00 £375.00
Provident Personal Credit £500 £17.50 52 £910.00 £410.00
Figures taken from www.lenderscompared.org.uk 14 October 2010