Commodo Flexible Credit Account: How It Works, Fees and Applying

A Commodo flexible credit account is a revolving loan from London Mutual Credit Union with a debit card attached. You are given a pre-approved limit, you can spend against it with the card, and the balance is repaid by a fixed monthly deduction from your salary through payroll. The same account is also offered under the names Forces Finance and Salaryflex¹.

The monthly deduction is the same every month regardless of how you use the card, and it is set at a minimum of one eighteenth of your approved revolving limit¹. The credit union decides your limit and repayment terms by assessing your ability to repay, including checks with credit reference agencies¹.

Because it is a payroll account, it is tied to your job. It is available to payroll members only, and if you stop working for one of the credit union's payroll deduction partners, the credit union has the right to convert the account to a regular loan and deactivate the debit card with immediate effect¹. The credit union's own documents carry today's interest rates and charges.

What it is and who it is for

The account is defined in the credit union's terms as your Commodo, Forces Finance or Salaryflex flexible credit account, provided by London Mutual Credit Union¹. It is a revolving credit facility rather than a current account: you have a limit you can borrow against, and you repay what you use on a fixed schedule.

The debit card is a separate product. The Commodo or Forces Finance Debit Card is a MasterCard debit card and is not a credit card, even though it is attached to a credit account¹. That distinction matters if you are comparing it with a credit card, because the borrowing sits on the flexible credit account and the card is simply the way you reach the funds.

It suits people whose employer runs payroll deduction with the credit union, because the repayment comes out of wages before it reaches your bank account. That is also its main constraint: the account is available to payroll members only, and it is not open to everyone who banks with the credit union¹.

If you are new to this type of lender, credit unions: a complete guide explains how they differ from banks, and what credit unions offer sets out the wider range of accounts and loans. The common bond page explains the membership link that decides who can join in the first place.

How it works

Once the credit union approves your limit, you can use the debit card to make purchases up to that pre-agreed limit¹. The credit union approves both the revolving limit and the repayment terms based on your ability to repay, assessed by the credit union and including checks with credit reference agencies¹.

Repayments are taken directly from your salary by payroll deduction, and the amount is the same every month regardless of how you use the card¹. The monthly deduction is a minimum of one eighteenth of your approved revolving limit¹. The credit union's own documents set out the limit and the monthly figure that applies to your account.

The credit union reviews the account from time to time, either when you ask or when it considers a review necessary, and a review can mean your revolving credit limit or your monthly repayments go up or down¹. It also sets a maximum positive balance that can be kept on the debit card at any one time, to protect you and the credit union and to minimise potential fraud¹.

If you maintain the balance at your maximum revolving limit for more than three months without trying to clear it, the credit union may take measures including temporarily stopping further borrowing or putting a temporary block on the debit card¹.

How the fees and charges work

The agreement is made up of several documents: the terms themselves, the Fees and Charges Schedule relevant to your account, which contains the interest rates and charges and related terms, and any additional terms the credit union gives you or puts on its website¹. Where the terms and the Fees and Charges Schedule differ, the Fees and Charges Schedule or the additional terms apply¹. That is the document to read for the actual figures, and the credit union's site has today's numbers.

Interest is calculated daily on your outstanding debit balance and added to your account balance each month¹. If you close the account, the terms continue to apply and interest and charges continue to be applied until the date the account is closed¹.

Several charges are described in the terms but priced in the schedule rather than in the terms themselves:

• Cash machine withdrawals may carry a fee, specified in the Fees and Charges Schedule¹.
• Cancelling a regular card payment may attract a small administration fee, with the level set out in the schedule or available by contacting the credit union¹. You must call by 4pm on the business day before the payment is due¹.
• Transactions in a currency other than sterling are free of fees for up to 30 days in a 12-month period, with charges possibly applying above that¹. Sterling conversion uses the MasterCard scheme exchange rate on the day MasterCard processes the transaction, and exchange rates vary daily¹.

There are also costs that only arise if things go wrong. If the credit union has to take action to obtain repayment, you will be required to repay its costs, charges and expenses, added to the debt on an indemnity basis, and its legal expenses and an administration charge if court action is needed¹. The credit union may also take any debit interest and charges you owe from the same account or from any other account you hold with it¹.

Who can apply and how to apply

To qualify for a Commodo flexible credit account you must be a member of London Mutual Credit Union and employed by one of the payroll deduction providers the credit union works with, excluding the Ministry of Defence¹. The Salaryflex version has the same membership and payroll requirement¹.

The application process involves a credit assessment. The credit union may use scoring methods to assess your application and verify your identity, and it searches credit reference agencies for information on your personal accounts, checking financial associates' accounts where relevant¹. A pre-application check of your credit file is carried out using QuickCheck; you will be able to see the search on your file but other organisations will not, so there is no impact on your credit rating¹.

If you are turned down or want to understand what lenders see, credit scores and credit reports explains how files are built. Records shared with credit reference agencies remain on file for six years after they are closed, whether settled or defaulted¹. If your circumstances change so that you are no longer financially linked to someone, you can apply for your credit file and file for a disassociation¹.

If you are not eligible for this account because your employer does not run payroll deduction, finding a credit union you can join covers the alternatives, and joining through your employer, trade or profession explains how workplace membership works. How to join a credit union sets out the ID and minimum share requirements.

How your money is protected

Credit union savings are covered by the Financial Services Compensation Scheme. Other credit unions state the position plainly: Oldham Credit Union says savings are fully protected up to £85,000³, M for Money Credit Union says eligible deposits are protected by the scheme⁴, Metro Moneywise Credit Union, which trades as The Money Co-op, says eligible deposits are protected⁵, and Mendip Community Credit Union says savings are fully covered⁶. Scotwest says it is covered by the scheme⁷.

The flexible credit account is a borrowing facility, so the protection that matters most to you is the money you hold in shares. Under the terms, you assign to the credit union all paid shares and payments on account of shares held with it, in any account held within the credit union, as security for the balance outstanding and any interest and expenses due, and you authorise the credit union to apply those shares towards what you owe¹. In practice that means your savings with the credit union stand behind the loan.

You also have responsibilities on security. You must act reasonably to prevent misuse of your account, any payment device and your security details, and if you do not, the credit union may block access to your account to protect you and it from unauthorised access¹. Security details are the personalised details you use to make an instruction, confirm your identity or access a payment device, such as a password, security code or PIN¹.

Problems, complaints and getting help

The first step is always the credit union. You must use the contact details at the back of the account booklet to give notices, including reporting an unauthorised payment or the loss, theft or unauthorised use of a payment device or security details¹. You must check your statement and tell the credit union as soon as possible if there is a payment in or out that you do not recognise¹. Statements are provided quarterly in writing, on request, and through mobile or online banking¹.

If you have difficulty making a regular monthly repayment, you must let the credit union know immediately¹. If you default, information about the outstanding loan may be passed to the Department for Work and Pensions for consideration of deductions from benefits you are entitled to¹. If you are an employee of a payroll deduction employer within the common bond and have failed to pay, you authorise your employer to deduct any amount due from your final wage or salary, including redundancy money or expenses¹.

If you are unhappy with the credit union's final response, or the timeframe has passed, you can take the complaint to the free Financial Ombudsman Service². The ombudsman handles issues such as account closures, disputed transactions, IT failures and problems with switching services⁸, and it can look at problems with a bank, insurance company, pension, credit card or loan⁹. In the first quarter of 2026/27 it opened 5,783 complaints about credit cards, 757 about debit cards and 11 about deferred payment credit¹⁰.

Free, impartial help is available elsewhere too. Falling behind on a credit union loan sets out what happens and what to do, and debt: a complete guide covers the formal options. Scotwest, another credit union, points members to free money advice agencies on its struggling with debt pages¹¹ and works with Money Helper on money advice covering making the most of your money and dealing with debt before it becomes a problem¹².