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MANCHESTER, U.K. – In the U.S. banks and credit unions fight each other on every battle ground imaginable. In the United Kingdom banks help credit unions. It is not an isolated phenomena to a single bank or region. Credit unions are not seen as competition to banks. Until 2001 credit unions were so limited in the size and the type of accounts that they could offer that they were considered only for poor people. Now that many restrictions have been lifted, credit unions are still being seen as poor people banks, although a number of credit unions such as Southwark and Leeds City have expanded their common bond to take in everyone in a geographical area and are growing rapidly. These new and larger credit unions are used by the middle classes as well as the poor. Banks take on specific credit union projects with a variety of goals. Some examples include: Sefton Credit Union in Liverpool uses office furniture and computers given to them by Alliance & Leicester. The bank started as a benefit society in 1862 and is based in Leicester. It showed a 263 (US$461) million operating profit as of June 2005. The bank is also working with several local groups to establish a new credit union in Leicester. Working with the Scottish Council of Voluntary Organizations, the Bank of Scotland is helping the North Edinburgh Credit Union to prepare business and marketing plans. They have contributed 100,000 (US$175,000) to the possibility of establishing a credit union for all of the city of Edinburgh. They are also examining the reduction of their pricing to credit unions. The Bank of Scotland and Clydesdale developed a “Credit Union Health Check” pilot program to make sure credit unions could become sustainable. Another bank offering free banking transactions to community credit unions is Lloyds TSB. They dedicated part of their Web site to people thinking of starting a credit union. They have offered reduce rent to the Cardiff Community Credit Union, sponsored 10 scholarships for a post-graduate Certificate in Co-operative Management and Organizational Development for credit union people at Leicester University, and spent about 13,000 (US$22,800) to train credit union volunteers. NatWest, part of the Royal Bank of Scotland Group has talked with the Birmingham Credit Union Development Agency to establish a pilot back office system for the credit union. It has also sponsored research studies about the credit union development as well as providing free banking to 21 community credit unions. The Northern Rock Foundation of Newcastle on Tyne, which is totally sponsored by Northern Rock Bank, gave 22,000 ($US38,500) to the Jarrow Credit Union to be used for computers and administrative support. Bank support is becoming engrained in the development of the British credit union movement, but as credit unions grow no one knows if the help will turn to hindrance. [email protected]

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