Rochdale credit union collapses
June 15, 2008
A Rochdale based credit union has collapsed and was recently closed down. Members of the credit union, Street Cred, have now lost access to their benefits, wages, and savings, but they have been reassured by the Financial Services Authority that their money is protected and is safe. The Financial Services Authority and officials from the credit union will be working together to sort out payouts for the members of Street Cred.
Credit unions are community run financial institutions, and offer savings and borrowing facilities to members of the community that join the union. Members receive various benefits and advice, and the personal touch offered by credit unions has seen them become increasingly popular over recent years. However, according to reports many households in the area have been left without access to funds as a result of the collapse of this credit union.
Member that have benefits paid into their accounts have been advised to contact the Department of Work and Pensions. Around three thousand people had joined Street Cred over the years, with most of the members from around the Greater Manchester, Rochdale, and Middleton areas. Reports state that the credit union managed to accrue debts that were nearing £500,000.
The local council has had to set up a helpline for consumers following the collapse of Street Cred, and one official from the council stated: “Savings with Streetcred are secure, but we want to ensure that account holders’ questions and concerns are dealt with quickly and effectively.” A spokesman from the Financial Services Compensation Scheme added: “We are aiming to get things done by Christmas. We are fairly confident we will be able to get this done.”
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