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Beyond the Big Banks: Exploring Credit Unions, Building Societies & National Savings and Investment

Updated: Sep 19, 2023

When it comes to managing our money, many of us tend to turn to the big banks for financial products and services. However, there are other types of financial institutions that offer a wide range of products and services that may be better suited to our needs. In this article, we will take a closer look at credit unions, building societies and national savings and investment.


To learn more about a variety of financial institutions watch the video below or read the blog.


Credit Unions


A credit union is a financial institution that is owned and controlled by its members. It's like a bank, but instead of being owned by shareholders, it's owned by the people who use its services. Credit unions offer similar services to banks such as savings accounts and loans, but they are different in a few ways.


One of the main differences is that credit unions are non-profit organisations. This means that they don't make money to give to shareholders like a bank would, instead they use their profits to help their members by offering lower interest rates on loans, and higher interest rates on savings accounts.


Credit unions are also often focused on serving specific communities, such as a particular company or organisation. For example, in the UK, The Police Credit Union serves current and former police officers and their families, while the London Mutual Credit Union serves people living or working in London.


Another example, the London Community Credit Union, which serves people living or working in London, it offers services such as savings accounts, loans, and financial education to help people with their money management. They also have a focus on helping those with financial difficulties, such as providing affordable credit to people who may struggle to get loans from traditional banks.



Building Societies


A building society is a financial institution that is owned and controlled by its members. Like a credit union, it's a mutual organisation, meaning that the people who use its services are also the owners of the building society. Building societies offer a wide range of financial products and services, including mortgages, savings accounts, and other financial products, while credit unions tend to just focus on providing affordable loans and savings accounts to specific communities, such as a particular company or organisation. Building societies also tend to serve a broader range of customers within a specific geographical area or region.


One of the main differences between a building society and a traditional bank is that building societies are mutual organisations. This means that they don't have shareholders and instead, use their profits to benefit their members by offering better rates on mortgages, savings accounts and other financial products.


Building societies are also known for providing excellent customer service, as they are often focused on serving a specific community or geographical area. For example, in the UK, the Nationwide Building Society serves customers all over the UK, while the Coventry Building Society serves customers in the West Midlands.


Another example, the Yorkshire Building Society, which serves customers in Yorkshire and the surrounding area, it offers services such as mortgages, savings accounts, and financial advice to help people with their money management. They are also known for providing excellent customer service and being focused on serving the local community.



National Savings and Investment


National Savings and Investment (NS&I) is a government-owned savings organisation that offers a wide range of savings products, including Premium Bonds, savings certificates, and ISAs. These are special types of savings accounts that are designed to help people save money.


One of the main differences between NS&I and traditional banks is that NS&I is government-owned, this means that they are backed by the government, which makes their products considered as low-risk savings options and safe places to save your money.


NS&I products are open to everyone in the UK, they don't require you to have a specific job or live in a specific area. They also offer a variety of savings products to suit different needs, such as Premium Bonds, which is a type of savings account where the interest is paid out in the form of cash prizes, savings certificates that have a fixed interest rate for a set period of time, and ISAs (Individual Savings Accounts) which are tax-free savings accounts.


Premium Bonds for example, is a savings product offered by NS&I that allows you to invest a minimum of £25 and a maximum of £50,000. Each month, the government conducts a prize draw where you could win prizes of up to £1 million.

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