Yesterday the South Birmingham Community Credit Union Ltd (CommuniSave Credit Union) announced that it has gone into liquidation. The credit union has over 2,000 members and serves the Northfield constituency as well as other areas in South Birmingham, Bromsgrove and Redditch.
The credit union will now no longer able to accept deposits, allow members to withdraw money, or make loans. The liquidators, Baker Tilly, Restructuring and Recovery Ltd., will be writing to all members to inform them of the news. The Financial Services Compensation Scheme (FSCS) have stepped in to protect the money of CommuniSave members. FCSS will automatically send payments to members, and promised that nearly all savers will get their money back within seven days.
The credit union have advised everyone affected to cancel payments being paid into a CommuniSave account – such as wages and benefits – and set up an alternative account that they can be paid into. This could be a new bank account, Post Office account, or an alternative Credit Union account – such as the CitySave Credit Union Ltd who cover the area.
You can find out more information from:
- CommuniSave – Information and Help Sheet
- Financial Services Compensation Scheme – Information and Q&A
- City Save – Alternative Credit Union
And get help and support from:
- South Birmingham Homeless Project – for advice and support call 0121 453 0606
- Local Food Banks – such as Cotteridge and the Life Line Food Bank in Northfield
It is not currently known exactly why the credit union has gone into liquidation. SBCCU has been affected by a lack of growth in loans, an increase in debts and lower investment – and the matter is now under investigation.
But what we can say is it is a huge shame that CommuniSave has had to close. Credit Unions are an important community alternative to high street banks who are reluctant to lend, and the pay day loan companies that are ripping off the most vulnerable with extortionate interest rates. I will be continuing to look at how we can strengthen and support credit unions to ensure low income people can borrow and save safely within the community.
With fewer and fewer options available for vulnerable people to access credit and finance, this is another wake-up call that our financial system badly needs reform. Are you experiencing problems as a former CommuniSave member? Please do get in touch.
