Sureena Brackenridge

It is a pleasure to serve under your chairship, Mr Twigg. I thank my hon. Friend the Member for Cumbernauld and Kirkintilloch (Katrina Murray) for securing this important debate about credit unions, as they play a crucial role in providing affordable financial services and promoting economic inclusion, particularly among those underserved by the traditional banks. As co-operative, member-owned institutions, credit unions focus on servicing their members’ needs rather than maximising profits. In my constituency, we are fortunate to benefit from the Wolverhampton City credit union, which serves over 10,000 members, manages more than £4.1 million in savings and has issued over £3.7 million in loans. It provides vital support for working people, pensioners, young savers and those on all incomes, by offering accessible credit and encouraging responsible saving. This helps families to avoid the traps of high-cost lenders and builds financial security across Wolverhampton North East. What truly sets Wolverhampton City credit union apart is its commitment to practical, member-focused initiatives. For example, its school uniform savings scheme is a simple but powerful way to help families to prepare for the financial pressure of each school year by encouraging parents to save small amounts regularly. The scheme ensures that they are not forced into debt when faced with the up-front cost of uniforms. That is just one of many community-driven initiatives that the credit union runs; others include budgeting advice, payroll savings partnerships with local employers, and junior saving clubs, all aimed at fostering long-term financial wellbeing. Despite the great work of credit unions, including Wolverhampton City credit union and others across the country, the sector in the United Kingdom has not reached the scale seen in other countries such as the United States, Canada and Ireland, where credit unions are more mainstream and serve a much larger proportion of the population. For example, the US Navy Federal credit union alone serves over 14 million members, showing what is possible when credit unions are given the room to grow. One structural barrier to growth is the common bond requirement, which restricts the potential membership base of credit unions. While the principle of shared connection, whether geographical or associational, is sensible, the current rules limit geographical common bonds to areas with up to 3 million potential members, making it impossible to operate a credit union that covers all of London or the midlands, for example. I therefore welcome the Government’s current consultation on reforming the common bond rules, which could allow credit unions in Great Britain to serve wider geographies and expand sustainably. That reform, alongside investment in digital infrastructure and proportionate regulation, will certainly benefit credit unions so that they can fulfil their potential. Credit unions tackle financial exclusion, supporting working people and strengthening communities, so I call for practical reforms and tangible support.