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NewsWhy women need credit unions
Why women need credit unions

Board director Hazel Malcolm marks the changes in women's relationship with money...

It may come as a surprise to younger women credit union members to learn that in the 1970s, women frequently had to get the permission of their husband or father before they could take out credit, even if the woman earned more than them. Nothing screamed ‘second class citizen’ more stridently than a woman’s experience of taking out a loan or a mortgage.

In fact, it wasn’t until 1975 that The Sex Discrimination Act finally outlawed discrimination against women seeking to obtain goods, facilities or services including loans or credit.

To celebrate International Women’s Day, it’s worth taking a little time to reflect how much has changed in women’s relationship with money - how much we earn, how we manage it, how we access financial products and who runs the financial institutions that are so crucial to all our lives.

We’ve come a long way. But there’s a way to go yet.

We still earn less than men: the current overall gender gap for full time workers is 13.9%. And while women are well represented in management in the banking industry, very few make it to the top.

And we’re disproportionately represented amongst the 1.5 million people who do not have a bank account - the financially excluded.

So I’m proud to serve as a volunteer director for the credit union that’s leading the way in empowering women in their relationship with money. Women are well represented in the running of the credit union - four of the nine Board of Directors are women, myself included. A total of 63 per cent of our members are women. Women make up the majority of our workforce. And the future workforce of the credit union is looking good for women too since two out of our three present and past apprentices are young women.

We know that a significant number of our women members are on benefits and low incomes, so we have tailored our Benefit Direct Loan to meet their needs, especially those bringing up children. In this way, we’re helping hundreds of women steer clear of the high interest payday lenders and doorstep lenders who contribute to over-indebtedness in WV.

But many challenges still remain. We know that our women members have been especially hit by the downturn in the economy and the cuts in public services, making managing money an even bigger struggle.

And young, female, lone parents living in rented accommodation and on low incomes are among the typical customers of the rent-to-own stores like BrightHouse and PerfectHome. They risk paying triple the price of household goods from these stores - which dominate our shopping centres - even before they take out their high interest loans. We’re looking at ways we can help our members avoid problem debt by avoiding these stores for furniture and household goods.

Money worries also affect women, impacting on their physical, mental and emotional wellbeing. That’s why we’re working with more WV employers - especially with majority women workforces - to help their employees save directly from their salary and access our low interest, ethical loans. We’re all beginning to recognise the clear links between financial wellbeing and health.

Finally, the credit union recognises that the long term financial resilience of women depends on better financial education. We’ve been reaching out to WV schools and youth organisations with a view to helping young people get to grips with the reality of money management by opening their own savings accounts and forming good habits that will last a lifetime.

Someone once said that a woman needs a bank account of her own to be liberated. I’d qualify that to say that a woman should open a credit union account and join an ethical financial community dedicated to her financial inclusion and resilience.

*Research by Financial Inclusion Centre.

A City of Wolverhampton Councillor and NHS Commissioner, Hazel joined the board in 2013 and was elected as Treasurer in 2015. She believes that as a local organisation, the credit union is able to be responsive to the needs of the community by working in partnership with others and campaigning on local issues. She wants the credit union to become a model of outstanding practice in terms of choice, customer service and innovation.

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