Members of Southend Credit Union to receive compensation in the next seven days

13th May 2011

Members of Southend Credit Union can expect to receive compensation from the Financial Services Compensation Scheme (FSCS) in the next seven days, after the credit union was declared in default today.

The FSCS is working with the credit union to get the information it needs to pay back depositors quickly. The FSCS will aim to pay compensation in the vast majority of cases within seven days, and pay any remaining claims, which are likely to be more complex, within twenty working days.

Southend Credit Union has just under 1,100 members with accounts totalling some £155,000. Declaring the credit union in default means the Scheme is satisfied that the credit union is unable, or likely to be unable, to pay back its members’ deposits.

Members of the credit union will be entitled to compensation of up to £85,000 each, and will not need to complete an application form to make a claim. Once the FSCS has the information it needs about each member’s account, it will make compensation payments automatically. In most cases, compensation will be paid by cash over the counter through Post Offices for amounts under £1000 and by cheque for anything above that figure.

The FSCS will provide a further update on its website by 20 May 2011.