Tag: Credit Unions

‘Circle of good’ making a difference for Leith-based community bank

2023 has been a year of exceptional growth for Castle Community Bank headquartered in Leith. At the AGM it was reported that total membership has grown to over 46,000 at September 2023.

Chief Executive Adrian Sargent said: “I’m proud of our team, and the growth that we have achieved this year. We remain focussed on our social purpose of supporting communities, whilst helping our members to maximise their savings and manage debt as effectively as possible.

At the same time, our overall current Trustpilot rating of 4.8/5 shows we are getting the day-to-day experience right for our membership.”

Castle Community Bank aims to achieve sustainability through scale and is on track to do so with total assets now equal to £283m, making them one of the largest credit unions in the UK. Deposits have grown to £247m in 2023 and the loan book has increased to £225m in 2023.

Castle Community Bank Chair, Stephen Pearson said: “I like to think of our operating model as a ‘circle of good’.

“Savers like our top quartile interest rates and easy online joining process. Many of them also like the fact that we make their money go further by funding our affordable loan products, enabling people who struggle to access loans from mainstream banks to borrow what they need at affordable rates.

“In turn, prudent, commercial success enables us to grow our community programmes in Edinburgh and beyond: including providing debt advice support, sustainable food bank funding and ethical investment for charities and churches.

“Castle Community Bank is leading the way in expanding the credit union movement in the UK, delivering strong and sustainable growth, underpinned by sound risk management.”

The Scottish credit union was established in 2015 following the merger of two long established credit unions: Castle and North Edinburgh (above), along with the members of the Water of Leith Credit Union Study Group.

The study group was set up with the aim of establishing a Credit Union in Leith.

The difference between credit unions or mutuals and high street banks is they are owned and run by members, instead of shareholders, creating a shared financial community across the UK, which is accessible to everyone.

Funding boost for Castle Community Bank

Social Investment Scotland support for Leith credit union

CASTLE Community Bank, based in Leith, has received £1 million investment from Social Investment Scotland. 

The credit union received the £1M sub-ordinated loan to support their growth and ambition to be a ‘business of scale’, providing ethical and affordable loans and excellent returns for savers.  

Colour photo head and shoulders of bank Chief Executive Adrian Sargent

Castle Community Bank Chief Executive Adrian Sargent said: “I’m delighted that Social Investment Scotland has confidence in Castle Community Bank and has invested £1 million.

“This fantastic investment will reap benefits for not only our organisation but also the communities and members we support in Leith and beyond. This is another important step in our journey to grow the credit union sector and promote financial inclusion in the UK.”

Social Investment Scotland Head of Investments Chris Jamieson, said: “We’re very happy to be supporting Castle Community Bank and its ambitious programme of targeted growth, which will positively impact people in Leith and the surrounding area.

“We see the important role that credit unions play in building a wellbeing economy, particularly when many individuals and households are struggling with the rising cost of living.

“That’s why we are committed to supporting organisations such as Castle Community Bank, who are providing fair and affordable access to finance for the people and communities who need it most.” 

New appointments at Castle Community Bank

Castle Community Bank (Castle) the credit union based in Leith, Edinburgh, has boosted its growth plans and financial inclusion ambitions by making key appointments to its Board and Executive team.  

Experienced non-executive director Stephen Pearson has been appointed as Chair of the Board. Following a career in law and financial services, Stephen has also recently been appointed Chair of the newly formed Financial Inclusion For Scotland.

As Chair of Castle, Stephen will be responsible for leadership of the board, ensuring that it effectively oversees Castle as it continues to grow and support its members through the cost-of-living crisis.

Last year Castle appointed a new chief executive, Adrian Sargent, who, alongside the previous chair, Ian Irvin, has overseen a period of substantial growth to ensure its sustainability in a difficult financial climate.

In addition, on 1 October 2022 Suzanne Gush was appointed as Chief Financial Officer. Suzanne has significant financial services experience and will support the board and management team in this next phase of Castle’s growth.

Stephen Pearson said: “The current cost-of-living-crisis and challenging UK financial climate, illustrate how important it is that all communities have access to fair savings and loan products as well as financial education.

“I’m looking forward to helping Castle and its partners make a positive difference in north Edinburgh and beyond, at such a key time for the organisation.”

Adrian Sargent said: “Stephen will be a great asset for Castle as we continue growing. Being fintech enabled, Castle is now well placed to help its members from a position of increasing strength. With Stephen’s fresh perspective and ethical fintech-savvy, Castle can find new ways of supporting our members.

“At Castle we are about sustainability for both the organisation and the community, and we are passionate about working hard for our communities. I’m excited about the next chapter for Castle, working with Stephen, Suzanne and the rest of the team.”

Castle offers savings and loans like any high street bank, but instead of making a profit for shareholders, Castle can invest surplus revenue into projects supporting its community.

As a credit union, Castle is regulated by both the Prudential Regulatory Authority (PRA) and the Financial Conduct Authority (FCA) who are part of the Bank of England. 

The Castle team sees the community bank as a force for good for its members who can access fair products that would otherwise be unavailable to them from mainstream banks. Castle also seeks to encourage thrift and financial well-being – essential tools for surviving the cost-of-living crisis.

Scottish Government launches Community Lenders Fund

Affordable credit as we emerge from COVID-19

A new £15 million fund has been announced to support affordable lending services.

The fund will support Credit Unions and Community Development Financial Institutions (CDFIs) which offer financial help to those who have poor credit and are often turned away from high street banks.

Communities Secretary Aileen Campbell said: “We know the pandemic has had a financial impact on many people in Scotland and we want to strengthen services that support people with managing their money.

“Credit unions and CDFIs provide ways of saving, lending, and accessing affordable credit.

“They can be a financial lifeline for people who can’t always access what they need from high street banks, helping them to avoid riskier ways of dealing with debt, like going to pay day loan companies.”

The funding will support work which:

  • promotes the availability of affordable credit
  • strengthens the balance sheet of affordable credit providers

Organisations are being invited to submit applications by 3 March 2021, and they will be informed of funding decisions during the week commencing 8 March.

Successful applicants will receive funding by 31 March. 

Credit Unions: increasing access to affordable credit

Creating healthy balance sheets for Credit Unions

More people will have greater access to affordable credit and savings plans through a new £10 million fund.

Announced as part of the Programme for Government, the Credit Union Investment Fund will support credit unions to increase financial inclusion and help them to grow.

Credit unions are member-owned financial co-operatives, meaning they exist only for the benefit of the people who  use their services. They are not-for-profit and, as such, any money they make goes right back into providing competitive rates on savings and loans.

The Fund, which will open next spring, will be supported by a new Credit Union strategy that will improve credit union systems and increase their provision of affordable credit, reducing the cost of borrowing and offering savings opportunities in a responsible way.

Communities Secretary Aileen Campbell said: “Credit Unions are driven by a singular purpose: to serve their members, rather than to make profits for a select few.

“While more than 410,000 people in Scotland are already members of a credit union, we want them to become more mainstream so more people can benefit from their ethical services.

“This is particularly so for people who are unable to access mainstream financial services or have limited choices on where to go to borrow money so can feel forced to turn to high cost lenders who can exploit their vulnerable position.

“Credit unions offer saving plans as well as repayment rates that are affordable and tailored to the borrower’s income.

“By working with the sector to deliver this fund and strategy, we can enable it to develop and flourish.”

People, Not Profit: Communities minister launches credit union campaign

The ‘People, Not Profit’ credit unions campaign was launched by Aileen Campbell, Cabinet Secretary for Communities and Local Government today, as results of a new survey reveal that one in five (20%) people in Scotland have not heard of a credit union. Continue reading People, Not Profit: Communities minister launches credit union campaign

Beating the big boys: Castle Community Bank raises interest rates

Castle Community Bank, the Edinburgh-based not-for-profit financial institution, has raised its fixed term rates for savers. It now offers 1.65% for two years and 1.75% for three years for fixed term deposits of up to £15,000 – a much better rate than the big banks currently offer.  Continue reading Beating the big boys: Castle Community Bank raises interest rates

Investing in junior savers

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Credit unions will be encouraging children to manage their money through new Junior Savers Schemes, Communities Secretary Angela Constance has announced. Ten credit unions working in areas like Aberdeen, Dumfries and Galloway, West Lothian and Stirling are set to receive a share of nearly £200,000 to set up new projects in schools. Continue reading Investing in junior savers