Payroll Deduction Scheme
Payroll Deduction Scheme
Become a Payroll Partner
The Eastern Savings and Loans Credit Union Payroll Savings and Loans Scheme can help your business reduce staff turnover and absenteeism costs as well as meet your corporate social responsibility objectives. Employers find that the credit union’s work in promoting savings as well as offering a low cost source of credit to employees reduces financial stress in employees. The primary objective of the credit union is to promote sound financial management by encouraging people to save rather than borrow in order to avoid debt, so if a member allocates part of any salary deduction to their savings account, as the loan is paid off, they accumulate savings. Over time members build up savings and can end the cycle of borrowing.
We work with employers to communicate the benefits of being a member of the credit union to employees. An effective campaign of communication includes repeated messages via:
All services are managed directly by the credit union and we accept full liability for the operation of the scheme. All enquiries and savings withdrawals are made through the credit union office, and a clear distinction is made between the employer and the credit union savings scheme.
Employers Guide to operating the Scheme
Download the full Payroll Scheme Brochure.
Eastern Savings and Loans Credit Union provides the Payroll Savings Scheme to the following employers:
1. Does it cost the employer anything?
No. The credit union provides this service to your business without charge.
2. Does it cost our employees anything?
There is a Membership Fee of £2 which is deducted from the first savings payment. Members further pay an annual fee of £13 to operate their savings/loans account levied at £0.25 per week.
3. Is it a lot of work for our payroll staff?
All enquiries of any kind at all are dealt with by the credit union office. The employer need not be involved in anything but a single monthly exchange of data and BACS funds transfer.
4. Can members access their account online?
Yes, members can register for online access at our website www.eslcu.co.uk. People can check balances, request withdrawals. We also provide telephone, email access.
5. Is the money safe?
The credit union is authorised and regulated by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). The regulation is the same as for other banks and building societies, requiring robust financial systems, training of staff, and internal/external audit systems. Insurance policies protect member’s savings. Ultimately the members’ savings are protected against business failure by the Financial Services Compensation Scheme up to £85,000 per person.
6. What rate of interest do you charge on your Loans?
Our Advantage Loan is available to individuals with a steady income and a good credit history. The interest rate is 0.5% per month an APR of 6.2% charged on the reducing balance.
A £3,000 loan paid back in 12 months will incur a total interest of only £98.88! Subject to status, other products are available.
7. How much interest do you pay on savings?
We pay a ‘dividend’ rather than a fixed rate of interest. This is paid annually, as a percentage of savings, subject to the performance of the business. However, no dividend has been paid since 2012.
8. Do members have to give notice to withdraw money?
No. We can transfer savings to the member’s bank account by BACS. We transfer BACS payments the same working day.
9. How do people pay into the Credit Union savings accounts?
Many employers allow staff to save directly from salary. Members can also pay by standing order, by cheque, or PayPoint. There is no minimum savings payment.
10. How much can a member borrow?
This is based on affordability. The loan sum may be greater if the applicant has already saved with us or has borrowed from us previously.
11. When can someone borrow?
Members can apply to borrow at any time but we give priority to those members who have saved for short period and/or are using a payroll deduction scheme.
12. Do you use credit reference agencies?
Yes, but past difficulty repaying loans will not automatically prevent applicants from borrowing from us. We may use a credit reference agency to verify ID and address.