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Two London credit unions are to merge and create one of the largest such organisations in England, joining together some 11,000 members.
Earlier this week, members of Radio Taxis Credit Union voted unanimously to merge with London Capital Credit Union, in a move that will create a new organization holding £7 million of assets.
A credit union is a financial co-operative that is owned by its members and exists primarily to provide savings and loans to these members. Unlike banks, they are not ultimately motivated to create profit for external shareholders.
In recent years, credit unions have been hailed as a more ethical alternative to high street banks and payday lenders.
“There is a greater need than ever for a more ethical source of financial services,” said Peter Gordon Brown of Radio Taxis Credit Union after the vote.
“People are still paying too much for borrowing and being discouraged from saving. This merger will make a larger and stronger credit union that will better serve many more thousands of people in years to come.”
Martin Groombridge, chief executive of London Capital, added, “Credit unions across the UK are dedicated to serving the needs of their members and we are proud to be offering an alternative to the high street banks and rip off rates charged by payday lenders and many other finance providers across London.”
The news of the merger comes in the same week that Bank of England statistics show that credit unions now hold over £1 billion in deposits.
The figures also reveal that membership of credit unions exceeded 1 million people at the end of March, up by 6.8% in just 6 months.
