Ethics

We have noticed a number of companies now talk about how ethical they are. Advance Credit Union is one of the many financial cooperatives around the world, owned by our Members and responsible to them – this means that we are open, honest and ethical – it is baked into what we do. Isn’t that how things should be? Here at AdvanceCU maybe we have assumed that everyone understands that we are ethical in how we treat our customers, staff, suppliers, partners and in our investments. However these are things that perhaps we should be quite clear about. Which is why we now have a page on Transparency explaining where we stand on a number of important issues. 

Customers

We aim to treat our customers fairly. This means we will do what we can to help you manage your money in the best way. We won’t sell products that aren’t suitable or a good offer. If we refuse a loan, we will explain why and suggest things to change to be accepted. We don’t always get things right, but we strive to offer the best value and best customer service. Providing quality financial information is important to us, such as our Life Events series. These all help our Members manage their money well. 

If a Member misses payments we will treat them with dignity and work with them to get back on track. Our door is never closed; any member with arrears can contact us even years later to resolve their bad debt. We know this can help improve credit history so we will do what we can to help. 

Our Members aren’t just customers; anyone who saves with Advance Credit Union is an ‘owner’, entitled to attend the AGM, vote on key decisions and stand for office. 

Staff

Our staff aWe are a Living Wage Employerre our biggest and most important investment. We wouldn’t be able to do what we do without their commitment and efforts. We are signed up as a Living Wage Employer. This means that all our employees earn more than the basic minimum wage. We also contribute to their pension to allow them to plan their financial futures. We run in-house and online training to help them develop their skills and knowledge. All our staff are actively involved in in what we do and how we do it; they can suggest changes to our Policies and can edit our Procedures so we keep operating as efficiently and effectively as possible. 

Suppliers

We prioritise dealing with suppliers that share our values and ethics, e.g. Living Wage Employers. Where possible, we will use local suppliers within our Common Bond area. We pay our bills on time. 

Partners

As a community credit union, it is important to us that we have positive relationships with local employers, community organisations and other groups. We also work with other local credit unions to share best practice and resources. 

Investments

Our best investment is by lending back out to members in our community. 45% of our assets are out on loan at the financial year end September 2017. We know that our affordable loans keep more money in member’s pockets allowing them to improve their lives in every way. We need some credit union members to save and some members borrow. Without those savers we wouldn’t be able to help as many people as we do to borrow responsibly and start the saving habit.

Our reserves and members savings not out on loan are invested with high street banks. We prioritise organisations that share our ethics and values. We do not invest in shares, property, or other investment vehicles. 

Corporate Governance

AdvanceCU strives to meet the highest standards of corporate governance. We work hard to ensure we comply with all our regulatory requirements, as well as meeting best-practice credit union standards in line with our member-ownership and mutual ethos.

Credit Unions in Great Britain are set up under the Credit Unions Act 1979 and the Co-operative and Community Benefit Societies Act 2014 (formerly the Industrial & Provident Societies Act 1965).

Advance Credit Union Ltd is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Our Firm Reference Number is 213228. Registered Company Number IP00130C at Companies House. You can check our details on the Financial Conduct Authority register by visiting www.fca.org.uk/firms/mutuals-public-register.

We are members of the Financial Services Compensation Scheme and we subscribe to the Financial Ombudsman Service.

Financial information, including Annual Accounts, is prepared for the benefit of our members, and our auditors report to the members only, in accordance with the Credit Union Act 1979. Our financial year end is 30th September each year.

Rules of Membership

As a co-operative AdvanceCU operates under a Rule Book which is approved by members at a General Meeting. Once changes are approved by members then a new Rule Book is registered with the Financial Conduct Authority under their responsibilities for Mutual Societies.

General Meetings

Formal General Meetings of members of AdvanceCU are called to deal with business set out in the Rule Book. There is usually one meeting each year – the Annual General Meeting (AGM). The business of the AGM is set out in the Rule Book and follows a fixed format each year.

It is also possible to hold Special General Meetings – these are held to deal with any formal business of the credit union which arises outside the AGM cycle which is too urgent to wait for the next AGM.

Members are notified about General Meetings according to the Rule Book. Only AdvanceCU members and invited guests may attend a General Meeting.

Annual Report

Our financial year end is 30th September, we appoint independent auditors to check our accounts and conduct an internal audit, in addition to our own internal audit. This process usually takes some time and crosses our busiest period pre-Christmas. So our Annual General Meeting is usually early March. Everyone who saves with Advance Credit Union is invited to attend, ask questions and vote on key decisions. The annual report is available to everyone who attends the AGM and afterwards upon request. The annual reports are also published on our website.

Read our latest Annual Report and Accounts

Internal Transparency

Whistleblowing

If you become aware of any risk, malpractice or wrongdoing that is in the public interest to know, you can report it to us through complaints@advancecu.org.uk. If we don’t address this to your satisfaction, please follow the FCA whistleblowing procedures.

If you have a complaint the best way is to contact us and we’ll normally be able to sort out the issue. See our page about Complaints and our Complaints Procedure. If you complain to us and you are not happy with the resolution you can refer your complaint to the Financial Ombudsman Service.

Read our Complaints Procedure.

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View FCA Whistleblowing Procedure

Product Transparency

We avoid fees and charges where possible. When we do have to make a charge there is often a free alternative. For example due to banking fees we charge £1 for a same-day withdrawals by Faster Payment. Withdrawals are free with 7-days notice.

 

Loan Arrears 

AdvanceCU process more than 4,000 loans each year to our members and new joiners totalling more than £2million. We follow a lending criteria that considers affordability, credit history and experience with AdvanceCU. We are conscious that some people will try to borrow more than they can afford so we won’t lend if we feel that repayments will put them at undue financial pressure.

Some members may be inexperienced with financial services and struggle to set up a payment plan, others may have unexpected bills or change in circumstances so struggle to pay in according with the loan repayment schedule. A very small minority of people take a loan with AdvanceCU and make very little effort to repay. We are responsible to our saver Members to recoup loans and interest wherever possible.

We follow a procedure for contacting and managing anyone who misses a payment, underpays or informs us that they may be facing financial difficulties, change in circumstances, job loss, etc. In each situation we will contact the member in arrears and do what we can to help get their loan back on track. We have a webpage to help people who have Missed Payments and a dedicated Arrears Hotline phone number 0121 663 1960. 

We aim to treat everyone in arrears with dignity at all times and work with them to help get back on track. Missing payments can affect the borrower’s credit history, so it is always best for anyone behind with their payments to come to an agreement with us rather than allow non-payment to continue.  

Arrears means the value of loan repayments and interest due but not paid to the credit union. We are required by regulators to set aside funds to cover this potential loss, which is currently 3.25% of the total loan book. If no payments are received for 12 months, a loan is considered for bad debt write off. This means that we continue to pursue the debtor in line with our credit control policy, but we remove it from the live loan book. Bad debtors do routinely get back in touch with us, sometimes many years later, due to change in circumstance, guilty conscience or family pressure. We always work with them to get back on track, some are now saving again regularly with us and may have a new loan with us. In the year 2016/17 we wrote off £43,000 of loans, but recouped more than £9,000 of bad debt written off in previous years. 

Your Ideas

Advance Credit Union is owned by its Members – this is your credit union. Do you have any suggestions for things we can make transparent? What would you like to know about your credit union? Send an email to our CEO with your ideas