London Capital Credit Union Review: The Benefits You Need?

The London Capital Credit Union is an organisation focused on helping members save money and end the spiral of debt. Those on low incomes or working to reduce existing debt can benefit, in particular. Learn about what the Credit Union offers, to decide if joining is right for you.

Our Thoughts: London Capital Credit Union Review

We really like the ethos behind the Credit Union—their primary objective is to encourage people to save money. Having savings set aside can help end the cycle of borrowing.

The Credit Union specialises in helping people on low incomes and/or those struggling with existing debt. Lower cost loans can be a great alternative to more expensive bank loans, credit cards or payday loans. In fact, a Credit Union loan can be used to pay off more expensive debt, helping to save money on debt repayment costs to become debt free in a shorter amount of time.

Products are designed to encourage saving. For example, members who need to borrow money can take out a "Saver Loan" to save money whilst repaying a loan—part of the loan repayments on a Saver Loan are allocated to the member's own savings account so the member accumulates savings as the loan is paid off.

Who Can Join London Capital Credit Union?

While the London Capital Credit Union is open to those in certain areas of London and the South East, employees of certain companies or groups can also become a member—regardless of where you live in the UK. Here are the membership requirements:

You can join London Capital Credit Union if you...
Live, work, study or worship:Barnet, Camden, City of London, Hackney, Haringey or Islington
Member or employee:The Co-operative Group in London and the South East Region (Berkshire, Buckinghamshire, East Sussex, Greater London, Hampshire, the Isle of Wight, Kent, Oxfordshire, Surrey and West Sussex)
Member:Unite the Union or Unison in the Greater London Region
Employee (anywhere in the UK):Amey, Barts Health NHS Trust, Bright Horizons, Cineworld, Circle Housing Group, Citizens Advice, East London Foundation NHS Trust, East Thames Housing Association, Fremantle Trust, Guardian Media Group, Homerton NHS Trust, Hyde Housing, Jewish Care, Local Space Housing, Metroline, Middlesex University, Moorfields NHS Trust, One Housing Group, Origin Housing, Radio Taxis Group, RNIB, Southern Housing Group, University College London, UCLH NHS Trust, Unison, Unite the Union, Veolia Environmental Services, Workers Educational Association

Those in other areas of London might be eligible to join a different credit union, such as London Mutual Credit Union or London Plus Credit Union.

Benefits of Joining the Credit Union

One benefit for members of the Credit Union is access to more affordable interest rates on loans. When members need to borrow money, and the Credit Union is often able to offer lower rates than members might find elsewhere. The Credit Union is largely volunteer run and has no outside shareholders, helping to keep costs and therefore interest rates low.

An additional benefit of being a Credit Union member is that as a member you are also an owner, entitled to a portion of any profits. The Credit Union returns any financial surplus to their members each year through a dividend.

Tools like Envelopes help members set aside money for bills like rent and utilities, to be sure they have enough to cover these essentials each month. Members can further benefit from cashback on some purchases and more affordable interest rates when they need to borrow.

Products Offered by London Capital Credit Union

The credit union's main goal is encouraging people to save, but they also provide products such as loans at a relatively low cost to help when people need to borrow. Below we give an overview of each product, including details such as loan sizes and typical interest rates.

London Capital Credit Union Loans

The Credit Union uses the savings from all the members as a pool of money to lend out to members needing a loan. London Capital Credit Union offers a wide range of loans to serve different needs, with loans available from £1 up to £20,000. For instance, those with money in their account as collateral can pay a lower rate of 4.9%. Rates are meant to be more affordable than you'd find elsewhere (e.g., compared to a traditional payday loan).

London Capital Credit Union LoansLoan SizeTypical Interest Rate
Saver Loan (Salary Savings Scheme)£1,201 to £20,00012.70%
Saver Loan (Other Payments)£1,201 to £20,00014.90%
Homeowner Loan£7,500 to £20,0002.9% to 9.9%
Flexi Loan£1 to £1,20026.80%
Security LoanWithin the balance of your savings with the Credit Union4.90%

Engage Classic VISA Debit Card and Account

The Engage Classic VISA Debit Card and Account act like a traditional debit card and current account. For instance the debit card enables you to withdraw money from an ATM and purchase goods or services online, in stores or restaurants. A potential perk for those trying not to overspend is that this card doesn’t let you go overdrawn.

  • Free to apply (plus you can have an additional card for free)
  • Free to use for purchases in the UK
  • Free mobile app (Android and iPhone)
  • Engage Envelope Money Management Tool
  • Earn up to 15% cashback with Engage rewards partners (list below)
  • £0.75 for an ATM withdrawal in the UK
  • Low management fees
  • Free to set up standing orders
  • Free email alerts to help you track spending

Engage Envelope Money Management Tool

To help ensure you have enough money set aside to pay essential bills such as your rent, mortgage, utilities and phone bills, the Credit Union offers a tool called Engage Envelope. You set up different "envelopes" (e.g., for rent) and when money comes into your Engage account it's automatically diverted into these envelopes so it won't be spent elsewhere.

Then essential bills are paid automatically when they are due, according to the instructions you've set (e.g., pay rent on the 15th of the month). Any leftover money in your Engage account that was not allocated to your Envelopes is for you to spend or save as you see fit.

Earn Cashback on Spending

Earn up to 15% cashback when you make purchases using the Engage Visa debit card at certain retailers in UK. These cashback rates are higher than you get from most rewards credit cards in the UK. Here are the retailers involved in the cashback programme:

  • Argos
  • Asda
  • Babies R Us
  • Belgo
  • Cafe Rouge
  • Debenhams
  • H. Samuel
  • Bella Italia
  • BHS
  • Halford
  • Ernest Jones
  • Inspire
  • Pizza Express
  • New Look
  • Leslie Davis
  • Spa Finder
  • Yo! Sushi
  • Toys R Us
  • Virgin Experience Days
  • Carpet Right
  • M&S
  • HotelStayUK
  • Hotel Exclusives
  • B&Q
  • TuneTribe

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