LONDON–Three U.K. credit unions have won a five star rating for personal loan products from the Fairbanking Foundation. It is the first time the Fairbanking Mark has been awarded to credit unions that serve employees of a specific sector.
The Fairbanking Foundation, a not-for-profit research-based charity founded in 2008, operates the certification scheme to encourage banking organizations to improve the financial well-being delivered by their products. The mark is granted in three, four or five star versions in five possible categories, based on the level of the financial wellbeing a product delivers.
The Hoot Credit Union, the 1st Class Credit Union and the NHS Credit Union have all achieved the highest accolade for their personal loans because they have a “tangible positive impact on customers’ financial well-being,” according to the Fairbanking Foundation.
“I am absolutely thrilled that we have been granted a five-star award for our main personal loan product,” said Robert Kelly, NHS CU chief executive officer. “Our commitment to serving members with high quality products and services built on an ethical value base and member centric ethos is the very fabric of our business model.”
Hoot Credit Union won the five-star mark for three products, including the Handy Loan which has the highest rate of interest of any product top win the Fairbanking Mark. The Foundation says the Handy Loan is designed to “enable recipients to save a certain amount while repaying the loan, which helps to positively develop saving habits”.
“Credit unions are playing an increasingly important role in people’s financial lives in the UK,” said Antony Elliott, chief executive of the Fairbanking Foundation, in a statement. “We have now worked with seven credit unions to ensure their personal loan products are ready to be granted Fairbanking Marks. The award for the Handy Loan product of the Hoot CU is a reassuring sign that there are personal loans serving the financial wellbeing of customers with poor credit ratings, for whom many less reputable alternatives exist.”
The Foundation evaluates a product’s features against a set of drivers of financial wellbeing and money management practices that have helped customers change behavior. It conducts extensive independent research into how the product is working in practice, and analyses descriptions, procedures and complaints.