Redcar & Cleveland Money Tree & Glen Credit Union declared in default

28th October 2014

The Financial Services Compensation Scheme (FSCS) is stepping in to protect more than 800 members of Redcar & Cleveland Money Tree & Glen Credit Union ('Redcar & Cleveland CU') after it was would up on 24 October 2014. The credit union is based in Redcar.

The Scheme is pledging that the overwhelming majority of savers will get their money back within seven days.

And people will not have to lift a finger to get their savings back. Using credit union records, FSCS will automatically send payments to members of the credit union.

Some 800 savers have around £200,000 with Redcar & Cleveland CU. People with up to a thousand pounds will receive a letter to get cash over the counter at their Post Office. Anyone with more than this will receive a cheque.

FSCS protects up to £85,000 of savings or £170,000 for joint accounts. It has come to the aid of more than 4.5m people since 2001 while paying out over £26bn in compensation.

Mark Oakes, Head of Communications for FSCS, says help is on the way. "FSCS is protecting Redcar & Cleveland Credit Union members. We're ready to help; your savings are safe. We will get your money back to you within the next week. The process is automatic so you won't have to apply for compensation. We will pay up to £85,000, so every member of the credit union is protected."

Financial services firms fund FSCS through a compulsory annual levy. The Scheme protects deposits, insurance and investments when authorised firms go bust. It has the most wide ranging protection of any scheme in the world. For more information visit our Q&As for deposits.

We also have a short video explaining how FSCS can help when your credit union goes out of business.

 

Jargon Buster

  • Credit union

    a financial co-operative which is owned and controlled by its members.
  • Deposits

    money placed in a bank or similar institution to earn interest or for safe-keeping.