ABCUL’s Advocacy for Credit Union Reforms  

Friday 13 December 2024

This week, featuring in the Financial Times (FT), ABCUL’s CEO, Robert Kelly discussed the Association’s views and how it’s advocating for targeted reforms of the credit union common bond legislation.

While the common bond remains a cornerstone of the credit union sector, its current structure presents challenges that must be addressed to support the long-term growth and sustainability of credit unions across the nation.

Speaking to FT, Robert said: “In recent years, we have observed a decline in the number of credit unions operating in Britain. While some closures have been due to operational failures, many have resulted from strategic mergers aimed at expanding the range of products and services offered to members.

“These mergers, though beneficial, often encounter barriers due to existing legislation – most notably, the £3mn potential member cap for locality common bonds.

“ABCUL has supported the regulatory process for such mergers and understands the complexity involved, particularly when receiving credit unions are forced to amend or reduce parts of a merging credit union’s common bond to comply with this cap. This restriction can hinder the intended benefits of mergers and limits opportunities for growth.

“ABCUL is committed to ensuring that greater flexibility within common bonds is introduced while preserving proportional legislation and regulation. By addressing these challenges thoughtfully, we can create a more enabling environment that supports the credit union sector’s continued growth and resilience, ultimately benefiting the millions of members we serve.

“We look forward to continued dialogue with our members and stakeholders as we advance this important work.”

Read the full article on the Financial Times website here.