Ormeau Road Credit Union Treasurer Ken Kelly: “It’s a haven for finances”
Founded in 1960, the Irish League of Credit Unions was created to meet the needs of people “left behind by the banking system,” says Ken Kelly, treasurer of Ormeau Road.
he former taxi driver has been on the board of directors of the Caisse populaire Ormeau since the early 1980s, seeing the establishment undergo several changes.
Some have been driven by regulatory changes as well as the digital revolution, but the ethics are still the same, he says.
“One thing that has remained the same is the model we are working from. The principle is that all credit unions are self-sufficient, we are a self-sustaining non-profit business and we are run by the people, for the people.
“Think of it as something like a golf club. It is owned by the members and is headed by a board of directors which includes a president, secretary, treasurer, etc. There are nine of us in total and we employ eight people, ”he says.
The late SDLP leader John Hume founded the credit union movement in Northern Ireland, bringing the financial institution to the people of Derry in the 1960s.
He regularly cited the founding of this credit union as one of his greatest achievements, and in 1964 he became the youngest president of the Irish League of Credit Unions, at age 27. He remained in office for four years.
“John Hume took an interest in the Credit Union and brought it up north, and today Derry Credit Union has substantial assets, around £ 100million.
“His contribution has been colossal. When credit unions came to Northern Ireland they started without legislation and John, with the support of Reverend Ian Paisley, put that legislation in place. They had influence to give it a profile.
Mr. Hume remained involved in the credit union movement throughout his life, alongside his huge role in politics and peacebuilding here.
In 2001, he was appointed Director for Life of the ILCU, this is only the second time that this honor has been bestowed upon him.
John’s involvement in the credit union, coupled with its very principles, made it a sort of social financial revolution in Northern Ireland.
Its unique selling point is that it offers credit to those who would not normally be able to access it.
It is also a haven for those who want to borrow and save without risk.
“We have the same laws as Danske Bank,” continues Ken. “But the philosophy of the credit union is that it belongs to its members. The money is not going to go to outside investors.
In the 1980s, when Ken joined Ormeau Road CU, they had assets worth £ 650,000. Today that figure stands at £ 22million.
The growth is a testament to the fact that the model is still working, even despite regulatory changes that have somewhat influenced its lending process.
“New legislation came into effect in 2012, which means CU is forced to check that people can afford to repay their loans.
“We have to record that we do these checks and while, yes, maybe it has changed the way we lend, are you throwing a concrete block at a drowning man or throwing a life jacket?
“We are a community business that will make you financially independent and that applies across all levels of the spectrum.
“This applies from the mid-level civil servant who wants to install a new kitchen to an individual who wants £ 500 to get them at Christmas.
“And it’s this service, this offer that brings people to the credit union.
“It’s not that easy to go to a bank and ask for something as little as a £ 500 loan. And you can’t just walk into a main street bank and pay £ 20 a week on your loan and that’s why we’re here, to provide that sense of community and access.
Currently, CU operates a 12.68% fixed rate loan representing an APR, with no prepayment charges.
It allows members to borrow £ 15,000 over their savings account balance, with a maximum loan of £ 25,000.
Over the years, the popularity of the credit union has remained strong. The branch now has around 7,000 members.
He adds: “Our demographics haven’t changed much. We would have an older type of membership and because we are family oriented and originally established by churches, more people have seen the benefit over the years, especially during the high rate years. high interest when a credit union was only allowed to charge a maximum interest rate. . “
Its membership spans from Cromac Square in Belfast to Carryduff, while the age range covers college leavers to their grandparents, and financial circles which include the ‘haves’ and the ‘gig economy’. “.
He adds that the 2008 accident strengthened CU’s reputation as a rock solid organization and a safe place for your money.
“We attract people thanks to our prices, which are still very competitive today. Or, financial crashes hit us hard with some people not being able to repay us, but we only offer payment holidays or interest payments when times are tough.
“But we’re a place where people can get credit and keep their money safe.
“If you look at the 2008 crash, people were worried about the bank collapse, but the credit union was seen as very conservative, not making a profit and not distributing profits to shareholders, so when people had money, they saw us in a safe haven, above all.
“The return on investment was secondary and the safety of the money was the priority. “
Throughout the year, credit unions must set aside enough money to ensure that they do not go bankrupt.
Any money that is left is redirected to those with savings accounts (to pay them interest) or it is used to try to improve the overall service.
The UC du chemin Ormeau is now advancing its digital offer.
“Sure, we’re behind the banks in new technology and we’re catching up, but it’s expensive,” says Ken.
“What we have is a place where someone can enter, say a taxi driver for example.
“He can borrow money to buy a vehicle, money to cover his insurance and tax years and that’s our main offer – that we are there on Main Street with employees from your. community.
“We wouldn’t see ourselves going entirely online. This is not who we are.
“We have a lot of customers who depend on a physical site and a lot of people who are just not ready to go digital.
“That’s not to say that I believe we are the solution to bank closures, we are not, but we are not moving in that direction, and as fast as the banks.”
Ken has benefited from the credit union his entire working life.
The 64-year-old started working as a butcher and then turned to the restaurant business. After that, he became a taxi driver.
“It helped me tremendously and helped me buy my first car. We see the credit union as a helping hand rather than a handout, and it has given me an education in finance.
“We will always be there. We recruit 400 new members a year and it’s the Credit Union USPs that will always appeal to this discerning customer.