Faughanvale Credit Union

Faughanvale Credit Union is a not-for-profit savings and borrowing co-operative for people living or working in the Faughanvale area of County Londonderry. Members save through three accounts, Shares, Easy shares and Christmas savings, and can borrow from the pool those savings create. It pays a dividend on savings each year rather than interest, and the amount is proposed by the board and voted on by members at the annual general meeting¹.

It is a small, local credit union rather than a bank. Money paid in is protected by the Financial Services Compensation Scheme³.

This page covers what it offers across savings and loans, who can join and how, how to pay in and take money out, how to contact it and complain, and where protection starts and stops.

What Faughanvale Credit Union offers its members

Faughanvale Credit Union describes itself as a not-for-profit structure in which profits are reinvested into better rates, improved services and dividends for members⁵. That is the model across the credit union movement: members pool their savings, and the pool is lent to other members, with any surplus shared out rather than paid to outside shareholders⁶.

Its product range is deliberately narrow. On the savings side it offers Shares, Easy shares and Christmas savings accounts¹. On the borrowing side it offers member loans, and it says over 95% of loan applications are approved³. It does not publish current account, mortgage or insurance products, so a reader looking for those would need a bank or building society instead.

That narrowness is typical. Credit unions generally offer savings and loans first, and many add junior savings accounts, Christmas savings accounts, prepaid debit cards, insurance products, cash ISAs and in some cases mortgages as they grow⁸. Faughanvale Credit Union's own published range is the three savings accounts and loans.

For the wider picture of how these co-operatives work, see Credit unions: a complete guide.

Savings accounts: Shares, Easy shares and Christmas savings

The three savings accounts serve different purposes, and the names tell you roughly what each is for.

Credit unions more widely offer a range of savings accounts including instant access accounts and ISAs, and some run nine or more separate savings products⁸. Faughanvale Credit Union's range is smaller than that, so if you want an ISA or a term deposit you would need to look elsewhere.

For how these accounts compare with bank and building society savings, see Savings accounts: a complete guide.

How dividends on savings work

Faughanvale Credit Union pays a dividend on savings each year¹. A dividend is not the same as interest. It is a share of the credit union's surplus, proposed by the board of directors and voted on by members at the annual general meeting, so the amount depends on how well the credit union has performed and on how much you have saved².

Across the movement, dividends are normally paid annually, and the amount you receive depends on how much you have saved and how much profit the credit union has made⁶. Profit shares distributed to members annually are known as a dividend¹⁴. Some credit unions describe the payment as an attractive dividend paid every year on members' savings¹⁵.

Two practical points follow. First, because a dividend is discretionary and voted on by members, it is not guaranteed in the way a contractual interest rate is. Second, because it is paid once a year rather than monthly, it does not give you a regular income from your savings.

Faughanvale Credit Union does not publish a dividend rate on its savings page, so the figure for any given year is confirmed by the credit union itself after the annual vote.

Loans from Faughanvale Credit Union

Faughanvale Credit Union offers loans to members and says over 95% of loans are approved³. You can apply by visiting the office in person, calling the office by telephone, or using the members section of the website³.

Credit union lending works differently from bank lending in one important respect: the money lent out comes from the savings of other members, not from wholesale funding markets¹⁶. That is why credit unions tend to lend within a common bond and why the amounts available are usually smaller than a bank would offer. Loan sizes across the movement vary widely, from around £50 to £15,000 at one credit union and £100 to £15,000 at another, with a maximum of £10,000 at a third¹⁷.

If you have a loan with Faughanvale Credit Union, your shares are treated differently. Any shares above the amount you must keep against the loan may be withdrawn at any time, provided the loan is not in arrears³. In other words, the credit union holds part of your savings as security while you owe it money, and the rest stays accessible.

For how credit union loans compare with other borrowing, see Loans: a complete guide.

Charges and minimum balances

It describes its savings as having no monthly fees¹.

The minimum balance is the figure to watch. It is higher than at many other credit unions, where £5 is a common floor: one credit union requires a minimum balance of £5.00 to be maintained at all times, another asks members to keep a minimum £5 in the account, and a third requires a minimum of £5 to keep the account open²⁰. At Faughanvale Credit Union the floor is £20.00, so a member who withdraws down to that level cannot take the last £20.00 out without closing the account.

On fees more generally, credit unions do not usually charge for a savings account, but a credit union current account is a different matter. MoneyHelper notes that you might pay a monthly fee to get a credit union current account, and that a monthly account fee often covers a debit card, setting up regular payments such as Direct Debits, and overdraft access²³. Faughanvale Credit Union does not publish a current account, so that fee does not apply here.

It stays your money, but it cannot be withdrawn while the account remains open⁵.

Who can join Faughanvale Credit Union

Membership is open to anyone living or working in the Faughanvale and surrounding area⁵. That is the credit union's common bond, the link that must exist between members. Across the movement, anyone can become a member provided they share a common bond with other members, which might be where they live, where they work, or membership of a particular organisation⁸.

The common bond matters because it decides whether you can join at all. A credit union in Hertfordshire, for example, is open to anyone who lives or works in Hertfordshire²⁴. If you are outside the Faughanvale area, you would need to find a credit union whose common bond covers you, which you can do through the Find Your Credit Union service⁸.

Junior membership is available too. Faughanvale Credit Union asks for the junior's full birth certificate as proof of identity⁵. Other credit unions commonly ask for two forms of identification for the child, such as a birth certificate, passport or NHS medical card, plus identification and address proof from the adult opening the account²⁵. Junior accounts are usually opened by a parent or guardian, and at many credit unions the account converts to an adult account when the holder turns 16²⁶.

How to become a member

New members must provide proof of identity and address verification, complete the Adult Membership Form, and are encouraged to complete a Nomination of Beneficiary Form⁵. Accepted photo identification includes a current driving licence, a valid passport, or an Electoral ID Card with a photo⁵.

The process at other credit unions gives a sense of what to expect:

1. Call into the office so a member of staff can help you complete the application form²⁸.
2. Or join online, then wait to be contacted for ID before the account is opened, with the application withdrawn if ID is not received within seven days²⁹.
3. Receive a welcome email with your membership number²⁹.

Some credit unions require a valid driving licence or passport to join online²⁴. Once you are a member, you can save and borrow. Some credit unions also run payroll deduction schemes through employers, where joining the scheme makes you a member automatically³⁰. Faughanvale Credit Union's published joining route is the membership form with proof of identity and address, so it is worth checking with the office whether your employer operates a payroll scheme.

Paying in and taking money out

Faughanvale Credit Union accepts deposits over the counter in the office, over the phone by debit card, online via its website, and by direct debit¹. Payments can be distributed among multiple accounts, so a single direct debit can be split between a member's shares, loans or other family members' accounts¹.

Withdrawals can be made in the office in person, or online if you have registered your account on the website¹. If you have a loan, any shares above the amount held against it may be withdrawn at any time, provided the loan is not in arrears³.

Other credit unions show the range of ways this can work:

• One accepts withdrawals by cash, cheque or bank transfer²².
• Another pays withdrawals by Faster Payment to a nominated bank account, or in cash up to £100 if available²⁹.
• A third allows withdrawals online, by telephone, in person or by post, with funds normally accessible the next working day if requested before 3pm³¹.
• Some credit unions also let members withdraw cash at a local Post Office⁶.

For the mechanics of moving money in and out of accounts generally, see Everyday money tasks: a step-by-step guide for UK consumers.

How your savings are protected

Savings with Faughanvale Credit Union are protected by the Financial Services Compensation Scheme, the same scheme that covers banks and building societies⁴. Credit unions across the UK are covered by the FSCS, and the scheme protects savings up to £120,000 per person per institution³². MoneyHelper puts the credit union limit at up to £120,000 per person, reflecting the higher temporary limit that applies in some circumstances²³.

Credit unions in Great Britain and Northern Ireland are regulated by the Financial Conduct Authority and the Bank of England's Prudential Regulation Authority³³. Savings with credit unions are protected by the Financial Services Compensation Scheme, in the same way as savings with banks and building societies³⁴.

If something goes wrong with a credit union and it cannot pay its members, the FSCS steps in. If you have a complaint the credit union cannot resolve, the Financial Ombudsman Service can look at it.

Contacting Faughanvale Credit Union and complaining

Faughanvale Credit Union's website is at faughanvalecreditunion.co.uk, and its savings, loans and membership pages set out the current terms¹. The office handles applications, deposits and withdrawals in person, and the credit union can be reached by telephone for loan applications and debit card payments¹.

If you have a complaint, raise it with the credit union first. If it is not resolved to your satisfaction, you can take it to the Financial Ombudsman Service, which is free and independent. For help understanding your options, the Consumer Council offers free support on financial services in Northern Ireland, and MoneyHelper provides free, impartial guidance across the UK³⁴.

If you paid by debit card and goods never arrived, the chargeback scheme through your bank is one route³⁷.

For more on your rights, see Consumer protection in UK financial services: a complete guide and Scams and fraud: a complete guide.