SAVERS who stick as little as £1 into a credit union savings account could win up to £5,000 a month in a new prize draw.
The Treasury has teamed up with 15 credit unions across Great Britain to launch a new "PrizeSaver" scheme.
How does the scheme work?
This will see everyone who opens a brand new savings account at a participating credit union (see the box below) be in with the chance of winning a prize in an automated monthly draw.
Every month will see a top prize of £5,000 awarded to the winning saver, with a further 20 smaller prizes of £20 also awarded.
Wins will be deposited to your credit account, and the more money you save, the greater chance you have of winning.
So save £20 and you'll 20 entries into the monthly prize draw up to a maximum of 200 entries per person – although you can save more than £200.
Which credit unions are taking part?
HERE are the 13 credit unions that are taking part in the scheme from today:
- 1st Alliance Credit Union – you must live in or be employed (or a relative of someone who is) in the locality of Ayrshire and Arran or be employed or a member of Irvine Housing Association or Cunninghame Housing Association
- Bradford District Credit Union – you must either live or work in the Bradford District
- Central Liverpool Credit Union – you must live or work in Liverpool, Halton, Knowsley, St Helens, Sefton or Wirral. Or, work for, be a tenant of or attend a qualifying organisation
- Clockwise Credit Union – you must live or work within Leicester, Leicestershire or Rutland or be a tenant or employee of the following housing associations: ASRA, Sanctuary, Stonewater
- Commsave Credit Union – you or a family member living at the same address must be an employee of certain firms including central government departments and telecoms and media groups
- East Sussex Credit Union – you must live or work in East Sussex, Brighton or Hove or be a member of Unite the Union, in the South East
- Merthyr Tydfil Borough Credit Union – anyone who lives or works within Merthyr Tydfil, Caerphilly, Blaenau Gwent and Rhondda Cynon Taf
- Nottingham Credit Union – for people living or working in Nottinghamshire, living in Nottingham's partners’ housing or working for one of its payroll partners
- Plane Saver Credit Union – for people or relatives of people who work for certain aviation companies, such as British Airways and Gatwick Ground Services
- Police Credit Union – you need to work for the police service
- Riverside Credit Union – for anyone who resides or is employed in a Liverpool postcode
- South Manchester Credit Union – for people who work or live in South Manchester
- Westcountry Savings and Loans – if you live or work in Somerset, Devon, Cornwall, Isles of Scilly, North Somerset, Bath & NE Somerset or the Bristol postcodes of BS8, 9, 10, 11, 14, 28,29,31 or 41, or you are a tenant or staff member of certain local housing firms or councils – see the website for the full list
The following two credit unions will also make accounts available at a later date:
- Lewisham Plus Credit Union – you must live or work in the London Borough of Lewisham or the London Borough of Bromley, or in the SE19 post code, or be a resident or employee of Lewisham Homes or Phoenix Community Housing Association.
- London Capital Credit Union – you must live, work, study or worship in any of the following areas: Barnet, Brent, Camden, City of London, Enfield, Hackney, Haringey, Islington, Waltham Forest
All the accounts provided are covered by the Financial Services Compensation Scheme (FSCS), which protects cash up to £85,000 if the credit union goes bust.
The first prize draw will take place in mid-December for people who sign up to a credit union from today and will last for 16 months until March 2021.
You can win an unlimited number of prizes but just check your union's withdrawal rules to make sure you'll have access to the cash straight away.
Interest rates and application criteria will also vary by credit union so check it's worth it before signing up and make sure you couldn't earn more in interest with a mainstream bank.
Existing credit union members with a savings account will have to contact their provider to find out if they can take part or if they'll have to switch their account to a different one.
If the trial is successful, the Treasury will consider rolling out the accounts and the prize draw to other credit unions.
But the Treasury says it's too early to say what will happen to the accounts or to the prize draw after March 2021.
The initiative has been partly inspired by the "Save to Win" scheme in the US, which the Treasury says has helped credit union members save $200million and has awarded $3.1million in prizes nationwide.
In the UK, the scheme is being funded by the Treasury and we've asked for an update on how many people eventually sign up.
Economic Secretary to the Treasury, John Glen, said: “We all know that saving for the future is important and I want to make it is as easy and attractive for people as possible."
What is a credit union?
Credit unions are a type of member-owned cooperative, controlled and run by members, which usually redistribute profits to members through interest or dividends, or by investing in new services.
Most either serve specific local areas or certain professions, such as the police.
For many who can't access mainstream banking, they're the only viable alternative to high-cost lenders.
Mr Glen added: “Credit unions provide an invaluable service for people up and down the country and I’m pleased that together we can give more people the chance to win while they save.”
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And we've rounded-up the top savings accounts.
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