Credit union in 'Europe's richest borough' converts wealthy residents
Published by Jon Land for 24dash.com in Communities and also in Finance
A credit union in the ‘richest borough in Europe’ is making a play for more of its wealthy residents to get on board to support some of the area’s estimated 24,500 struggling families.
YourCU is urging community-minded people and local residents’ associations, garden square committees and churches in the Royal Borough of Kensington & Chelsea to invest up to £15,000 with them.
The Kensington High Street-based union is paying 1.6% on dividend paying corporate accounts it will be able to use to lend to people on low incomes who may otherwise be unable to access mainstream banking.
Last month, YourCU lent out £60,000 to local people, many marginalised from financial services, often at the mercy of payday lenders, pawnbrokers and illegal loan sharks.
“We know there is a huge amount of good will out there and we’d love people to come on board and help swell our coffers to support families who are feeling the pinch,” said YourCU CEO William Rhodes.
“There are individuals, and organisations in the borough with money in their reserves, who would surely welcome the chance to invest it for the social good at an interest rate that tops many high street banks.”
YourCU currently has savings on deposit totalling more than £500,000, a sum it is hoping to triple by the end of the year.
Local politicians including assistant whip Greg Hands MP, Labour MPs Karen Buck and Andrew Slaughter, and London Assembly members Kit Malthouse and Murad Qureshi have all become members of the union.
In the past six months YourCU has also attracted corporate deposits from local firms, housing associations and churches, including St John's in Kensal Rise and St Peter’s in Notting Hill, both of which put in £10,000.
The union is being backed by a number of organisations, including the Royal Borough of Kensington & Chelsea and charity the Octavia Foundation.
According to the Kensington and Chelsea Foundation, the borough is one of extreme contrasts, with some of the northern wards, such as Golborne, ranking among the nation's most deprived.
More than half the borough's children attend private schools, but 35% of those who go to state schools qualify for free school meals – double the national average.
A feasibility study by the Octavia Foundation in 2009 identified more than 24,500 financially excluded households in the borough, each paying a ‘poverty premium’ of up to £1,000 each year through higher cost of borrowing, higher bills, additional charges and lack of access to cheaper deals.