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How Churches can help Credit Unions and the proposed Churches’ Mutual Credit Union Ltd.

This presentation explores how churches can assist credit unions and the proposed Churches' Mutual Credit Union Ltd. It outlines strategies for parish involvement, governance, capital injection, savers and borrowers support, service point hosting, and publicity. It also details membership eligibility, services the CMCU will provide, and a strategic plan for launching the Car Loan Scheme. The timeline for launch and potential impact on mission funding are discussed.

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How Churches can help Credit Unions and the proposed Churches’ Mutual Credit Union Ltd.

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  1. How Churches can help Credit Unions and the proposed Churches’ Mutual Credit Union Ltd. Revd Canon Antony MacRow-Wood ACA Chair of Shadow board Presentation to Salisbury Diocesan Synod 9th November 2013

  2. The Church of England’s Current National Strategy • C of E is developing a 3 pronged strategy for credit unions. • Firstly to link parish churches to local credit unions. • Secondly an Archbishop’s taskforce to work credit unions and local banking sector to produce credible, financially responsible, alternatives. • Thirdly a plan to found the Church’s own credit union, primarily for clergy and Church employees.

  3. Part 1: How Can Churches Help A Local Credit Union? • Be strategic – send someone reasonably senior to ask what help would be most useful • Listen to the reply • Could be: Governance Capital injection Savers Borrowers Host a Service point Publicity

  4. Part 1: How Can Churches Help A Local Credit Union? Governance • Credit unions are governed by volunteer directors, boards can lack crucial skills. • Our churches have some well qualified people with financial, business and legal skills. • Time commitment 1-2 evenings a month

  5. Part 1: How Can Churches Help A Local Credit Union? Capital Injection: • Credit Unions are required to have 3% capital to assets ratio by September 2014. • Churches must do due diligence and have regard for the advice from C of E lawyers re investments. • Individuals or churches can make donations.

  6. Part 1: How Can Churches Help A Local Credit Union? Savers and Borrowers: • If the Credit Union is well lent out it will welcome people who join and just want to save. • Especially if it has a reasonably high demand for loans but is concerned about liquidity. • If it is not well lent out, may not welcome more savers as will erode their capital to assets ratio. • They will welcome more borrowers. Christians could see this like buying fairtrade goods.

  7. Part 1: How Can Churches Help A Local Credit Union? Host (and help run) a Service Point: • Credit Unions are wary of the ‘Poor Man’s Bank’ label – don’t want to operate out of tatty premises. • Ideal location – out of town estates with no access to financial services. • Find volunteers to help run it. • Wonga’s average loan £178, someone saving £2 (price of a lottery ticket) a week for two years would not need a payday loan.

  8. Part 1: How Can Churches Help A Local Credit Union? Publicity: • Help create news stories like the recent visits of Bishops to credit unions. • Have posters up and leaflets available in your church. • Word of mouth – be informed about services, products and access channels so you can tell people about their local credit union.

  9. Part 2: Membership will be open to… 1. Baptised members of Church of Scotland & Anglican Churches in GB (or those formally received into membership) provided that: • They are ordained or training for ordination or • They are a Licensed Lay Minister, or • They are employed by a CofS or Anglican Church or Charity, or • They are a trustee of a CofS or Anglican Church or Charity

  10. Part 2: Membership will be open to… • Persons living in the same household as the above. • Church of Scotland or Anglican Churches or Charities based in Great Britain. • Employees of Ecclesiastical Insurance Co. • And eventually…. members of an Anglican/CofS Electoral Roll or equivalent, and other denominations.

  11. Part 3: What will the CMCU do for its members? • A practical, ethical and accountable provider for tax efficient saving and affordable credit. • A competitive alternative source of consumer loans. • The capacity to begin saving, improve financial capability and plan for retirement. • In due course provide mortgages for retirement housing.

  12. Part 4: Strategy for CMCU Car Loan Scheme and payroll deduction can build sustainable business within 3 years Concentrate membership recruitment on those on the central payroll but have direct debit facility. Launch with more than 5% capital so can offer interest on savings. By including trustees of church charities will have members with the expertise to run it. Internet banking. Work in partnership with EIG to have access to office premises at cost and marketing expertise.

  13. Timeline to Launch • Just submitted application to the regulators. • Continuing to raise start up capital. • May 2014 launch liturgy as part of General Assembly of C of S. • ‘Soft launch’ at General Synod July 2014, begin trading 1st October 2014. • In 10 years time, could be main source of mission funding for parishes.

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