Credit Unions are membership based, voluntary run, not for profit, savings and loans co-operatives. This means that to join a Credit Union and become a member you must either live or work in its 'common bond' area.
The common bond of Bacup Credit Union is “anyone living or working in OL11, OL12, OL13, OL14, OL16, BL0, BL9 and BB4 post code areas”. Essentially, that's all of Rossendale, Edenfield and Ramsbottom, then parts of North Bury, North Rochdale and across to Todmorden.
Members deposit their savings which are called ‘Shares’ to form a pool of money. From the pool of money that is formed – members can apply for a low cost loan as and when needed (maximum 2.75% interest per month on the reducing balance) the Credit Union generates its income from the interest it charges on the loans that are given out to members, bank interest paid on the deposit account, annual membership fees and fundraising. The income is used to pay the running expenses such as rent, utilities, stationery, postages, insurances, regulatory fees, auditors fees and regulatory reserves. At the end of the financial year (September) any surplus income is paid back to the members as a dividend on their shares.
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