Penny Post Credit Union

Penny Post Credit Union lets its members save and borrow through their pay. Savings are taken straight from your wages into a membership account, and loans are repaid the same way, weekly or monthly, so the money never sits in your current account waiting to be spent¹. Savings earn an annual dividend rather than a fixed interest rate, and deposits are protected by the Financial Services Compensation Scheme up to £120,000 per member³. Members can also open a Young Saver account for children or grandchildren under 18, and apply for loans that range from a straightforward Personal loan to options linked to what they have saved¹.

The core idea is payroll saving and borrowing. Members save regularly straight from their pay, and can apply for loans that are repaid the same way, weekly or monthly¹. Penny Post is not a bank: it is, in its own words, "an independent business, owned by and run for the benefit of members", and each member has voting rights on a "one member, one vote" basis, regardless of how much they hold in shares³. This page explains each product type Penny Post sells, who can join, how lending decisions are made, how to manage your account, and where to get help if something goes wrong.

What Penny Post Credit Union offers its members

Penny Post's product range is deliberately narrow: savings and loans, built around the payroll relationship. Members save straight from their pay into a membership account, and the same payroll link is used to repay loans⁷. Savings earn an annual dividend rather than a guaranteed interest rate, and members can also open a Young Saver account for children or grandchildren under 18⁴. On the lending side, Penny Post offers a Personal loan for members without savings, an Advantage loan linked to your savings balance, and a Credit Builder option, with the current terms and amounts on its own loans page¹.

That model is typical of credit unions generally. The Welsh Government describes credit unions as providing "access to fair and affordable credit for people with a poor credit history" and those who cannot access mainstream forms of credit⁹. Many credit unions offer a wider choice of additional products, such as junior savings accounts, Christmas savings accounts, prepaid debit cards, insurance products, cash ISAs and in some cases mortgages¹⁰, though Penny Post's own published range centres on savings and loans. Credit union accounts are typically free for paying in or taking out cash, having money paid in such as wages, benefits and pensions, online, mobile or telephone banking, and budgeting advice and support¹¹.

Membership also carries rights beyond the products. Each member votes at the AGM, including on the dividend rate, and juvenile members are not entitled to vote³. Penny Post also provides a free Bereavement Fund, giving financial help in the event of a member's death, which is covered in more detail below⁷. If you are comparing credit unions generally, see the guide to credit unions, and for how savings accounts work across the market, see savings accounts.

Savings accounts and how the dividend works

Penny Post savings are held as shares in the credit union, and they earn a dividend rather than interest. The dividend is declared annually: profit shares are distributed amongst credit union members once a year and are known as a dividend¹², and the amount you get depends on how much you have saved and how much profit the credit union has made¹³. Penny Post's own terms state that any dividend is declared on all full shares held in eligible share accounts during the preceding year of account, and that interest bearing accounts are not eligible for a dividend³.

The important caveat is that a dividend is not a guaranteed return. Penny Post states plainly that dividends are not guaranteed, that the rate payable is dependent on financial performance, and that it is voted on by members at the Annual General Meeting⁸. This is the normal position across the sector: credit unions normally pay a dividend once a year¹⁴, but the rate can fall as well as rise with the credit union's results. Anyone comparing a credit union savings account with a bank account offering a fixed rate should understand that difference before they save.

Saving with Penny Post is designed to happen through your pay. Members are asked to save regularly, straight from their pay, and must save at least £2 weekly or £10 monthly to remain a Penny Post member⁷. Members who stop maintaining regular payments into the member account can, at Penny Post's discretion, have their membership terminated³, so the minimum is a condition of belonging, not just a suggestion. You can also pay in by debit card, with funds available to withdraw after 3 working days, or by standing order, with money placed in your account on the day after it is received into the credit union's bank account³.

Members can open a Young Saver account for their children or grandchildren under 18 years of age⁴, which works alongside the adult member's own savings. For how dividends and interest compare across the wider savings market, see savings accounts.

Personal, Advantage and Credit Builder loans

Penny Post lends to members rather than to the general public, and its loan range is built around how much you have saved with it. The Personal loan is for members who want to borrow without needing savings with Penny Post first. The Advantage loan lets you borrow as a multiple of your Penny Post savings balance. There are also loans secured on your savings balance, where you borrow up to what you have saved, and a Credit Builder option. The amounts available under each loan, and the interest rates that apply, are set out on Penny Post's own loans page, which carries a free loan calculator described as simple, quick and with no obligation¹.

Two features are worth understanding before you apply. First, repayments are on a weekly or monthly basis, tailored to suit your budget¹, and they are normally taken straight from your pay². Second, existing borrowers can apply to top up a loan once they have repaid 10% of the original loan value, or 20% of a first Personal loan², which means one repayment instead of two rather than a separate second loan.

Membership of Penny Post, or completion of a loan application, does not guarantee a loan will be granted³. Loans are not available to members who are bankrupt or have an IVA showing on their credit report, normally for six years after the event, though those members may still save and receive the annual dividend, profits allowing¹. Having an IVA makes it harder to open new bank accounts, get loans or buy on credit generally¹⁶, and a CCJ can and should be included in an IVA¹⁷, so Penny Post's approach is consistent with how these arrangements are treated across the credit market.

For how personal loans work generally, including what to compare and what a credit check involves, see loans and credit scores and credit reports.

Who can join and who can borrow

Credit union membership works through a common bond: members have something in common with one another, and that common bond determines who can join. For Penny Post, the bond is linked to employment, and its terms list individuals employed in connection with the credit union among those eligible³. In practice most members join through one of Penny Post's Payroll Partners, with saving and loan repayment deducted from their pay³. You must be 18 years of age or over to borrow².

The rules on who can join a credit union have been widening. A 2026 announcement on changes to credit union membership caps noted that eligibility will widen to include students, local workers and relatives of existing members, reflecting the way people live and work now¹⁶. If you are unsure whether you qualify, Penny Post's own membership pages set out the current position, and the general guide to credit unions explains how common bonds work.

Two further points affect existing members. If a member is about to leave one of the Payroll Partners, Penny Post asks that contact is made as soon as possible; arrangements can be made to repay an outstanding loan balance by standing order, and leavers are welcome to remain a member, saving regularly and borrowing by direct debit³. And membership can be terminated at Penny Post's discretion if regular payments into the member account are not maintained³, so keeping up the minimum saving matters even when you are not borrowing.

How a loan application is assessed

Penny Post, like all credit unions, always considers affordability when assessing loan applications⁹. Its own description is that every loan application is assessed on its own merits, with a focus on affordability¹. In practice the process works like this. You can apply on the Penny Post mobile app, through the online loan application form, or via Nivo from your mobile; a paper application form can be posted out on request⁴. As part of the assessment Penny Post uses licensed credit reference agencies¹, and its loan FAQs name Equifax as the agency it uses². It may also share your information with credit reference agencies for credit decisions, fraud prevention and pursuing debtors³.

To assess affordability, Penny Post asks to view your last 3 months of income and expenditure, normally through Open Banking; if Open Banking cannot be used, you will need to supply copies of your last 3 months of bank statements instead². You will also need a payslip showing your name and address, no more than 4 weeks old². In most cases Penny Post makes decisions on the same working day, though at busy times it may take a little longer².

The final decision sits with the underwriters. They will decline an application if, in their opinion, granting the loan would be against the interest of the credit union or the member, taking into consideration length of membership, savings and loan record, the amount requested, a credit reference agency credit report, affordability, current credit union rules and policies, and any other information they consider relevant³. There is no published waiting period before reapplying after a decline, but a fresh application is judged on its own merits, so a change in your affordability picture is what matters.

Repaying a loan through your pay or online

The standard repayment route is payroll deduction. Penny Post loans are repaid straight from your pay, on a weekly or monthly (salaries) basis², with repayments tailored to suit your budget¹. That structure means the repayment happens before the money reaches your current account, which some members find easier to manage than a direct debit, though it does depend on your employer being a Payroll Partner.

You are not limited to payroll deductions. Members can make loan repayments at any time using Online Banking and the secure WorldPay platform⁴, so you can pay extra or catch up outside the payroll cycle. If you leave your Payroll Partner, you can keep your membership and repay by standing order or direct debit instead³.

There is also a statutory-style cancellation right. Under the distance marketing rules, members have the right to cancel a loan agreement within 14 days of signing their contract, by calling Penny Post or emailing it, and returning the money lent³. If you cancel, you return what you borrowed, so the right unwinds the loan rather than changing its terms. For what happens when repayments become difficult, see the complaints and help section below, and for the wider picture see debt.

Managing your account: app, online banking and withdrawals

Day-to-day access is through the Penny Post app and Online Banking. The quickest and easiest way to withdraw savings is using Online Banking or the Penny Post app: you request a withdrawal, and funds are transferred to your bank or building society account⁸. To log in for the first time you need a PIN, which is sent when you first register for online services and can be changed once you are logged in⁴.

Paying in works several ways. Debit card payments are available for withdrawal after 3 working days, and standing order payments are placed in your account on the day after they reach the credit union's bank account³. Payroll saving remains the main route for most members⁷. Penny Post does not publish branch or counter opening details in the material here, so if you need to pay in cash or by cheque, check with it first.

It is worth being clear about what a Penny Post account is not. It is a savings account, not a current account: it does not give you a debit card for everyday spending or a full banking service. A bank or current account usually lets you receive benefits and wages, spend in shops, withdraw cash, manage money online or by mobile app, and set up direct debits and standing orders¹⁸, and most credit union accounts, including Penny Post's, are built around saving and borrowing instead. If you need a full current account alongside your Penny Post savings, depending on the account you can usually open one online, using an app, over the phone or in person¹⁸. See current accounts for how they work.

The Bereavement Fund and nominees

Penny Post provides a free Bereavement Fund, giving financial help and peace of mind in the event of a member's death⁷. The fund is free to members, and it sits alongside the savings and loan products rather than being insurance you buy separately. Penny Post does not publish the payment rules for its own fund in the material here, so the amounts and conditions are on its membership account pages.

The wider Penny Post Group also operates a nominee system, which is how money in a credit union account can be passed on quickly after a death. Retail CU, a trading name of the same authorised firm, publishes the detail: all members can nominate a person, or persons, to receive their money, up to the value of £5,000. Where a deceased member has more than £5,000, the first £5,000 is paid to the nominee and the remainder forms part of the deceased's estate. The nominee must satisfy identification procedures and complete an indemnity form, and members can amend their nominated beneficiary at any time by completing a Nominee Appointment and Amendment Form¹⁹. Retail CU's published examples show how the Bereavement Fund can double savings on death: a member with £800 in savings and a £3,000 loan generated a payment of £1,600 (£800 savings, doubled), while a member with £20,000 in savings and a £6,000 loan generated £5,000¹⁹.

Because Retail CU and Penny Post are trading names of the same firm⁵, the nominee mechanics are likely to be similar, but the rules that apply to your account are the ones in your own credit union's terms, so check with Penny Post before relying on them. Nominating a beneficiary is separate from making a will, and it can mean money reaches family faster and with less paperwork. For how life insurance and other protection products work, see protection insurance.

Complaints and help if you struggle to repay

If you cannot keep up loan repayments, Penny Post's stated approach is to contact it immediately: the matter will be treated sympathetically and in total confidence, and depending on circumstances it will work with you and renegotiate the loan if possible⁴. That is the point at which renegotiation is most likely, so raising the problem early matters.

The formal position on missed payments is firmer. When loan repayments are missed, a loan becomes delinquent, and Penny Post is obliged to recover delinquent loans. Savings can be used to recover loan repayments, and Penny Post states that it does take legal action, including applying for County Court Judgements, and uses debt collection companies and solicitors, with costs added to outstanding loans³. In other words, your savings with the credit union are not ring-fenced from a debt you owe it, and collection costs can grow the balance you owe.

Members have the right to complain, and full details are in Penny Post's Internal Complaint Procedure document⁴. If a complaint is not resolved to your satisfaction, an unresolved complaint about a regulated firm can be taken to the Financial Ombudsman Service, the free independent body that settles disputes between consumers and financial firms; see consumer protection for how the process works. For free help with problem debts generally, including budgeting and the options for dealing with multiple creditors, see debt.

*A member discussing repayment options with a credit union adviser, the first step Penny Post asks members to take when payments become difficult.

FSCS protection for Penny Post savings

Deposits held in Penny Post are covered by the Financial Services Compensation Scheme (FSCS), which means your savings are protected by the scheme up to £120,000 per member³. This is the same protection that applies to bank and building society deposits, and it is the official position across the sector: the Welsh Government confirms that credit union loans and savings are protected by the FSCS⁹.

The limit applies per member, per authorised firm. Because Voyager Alliance Credit Union and Retail CU are trading names of the same authorised firm as Penny Post⁵, a member with savings under more than one of these brands should check with the credit union how those balances are treated for FSCS purposes, since the scheme protects each person against each authorised firm up to the limit, not against each brand. All shares, meaning savings, in an affiliated credit union are eligible for FSCS protection.

If a credit union were to fail, the FSCS would pay out compensation up to the limit; the scheme covers the deposits themselves, not the value of any dividend that might have been declared in future, since dividends are not guaranteed⁸. For how the FSCS works across banks, insurers and pensions generally, see consumer protection.