February 25 th 2013

Agenda Aims of Partnering Trusted Partner concept Accounts and services Delivery / kiosk network BHSF – working in partnership

UK personal banking 9m adults without fit for purpose banking solution Prepaid card market at c£650m Home credit & mail order £3bn Arrears on utilities, rents and mortgages are common Poverty premium of £1k per annum High cost, highly promoted and easy access payday lending sector now worth est £2bn

Potential DWP feasibility report “credit unions appear to be the only other realistic option” Between 25% and 50% of the populations of the USA, Canada, & Australia are credit union members Citysave aim for 5% of Birmingham market in 5 years

Aims of Partnering Birmingham 187 identified communities Diverse & busy Citysave needs to reach into communities Need to find ways to overcome barriers to opening accounts including language, literacy, confidence, trust Need to find ways to scale efficiently Need to deliver a wider range of products to a wider range of membership Those most at risk of paying poverty premium are least likely to engage

Aims of Partnering Vision: Build the credit union network through successful and individual organisations Strong visibility Trusted brand operating centrally in our communities Accessible to everyone who needs us Affordable, with high perceived value for money Fit for purpose, modern solutions particularly for younger adults Operated for members requirements Self - Sustainable

For our members Better money management Better payment solutions Removal of poverty premium Branded and trusted long term financial alternative Good access to community based financial institutions Less reliance on lending & Saving ethic Access to affordable lending Access to first time buyer mortgages – shared ownership and easy start options Members of a modern financial co-operative

Partnering... Care Housing providers Support system Intervention Employers Welfare to work Councils Mutuals Utilities Corporates

Trusted Partner concept Permission for another trusted organisation to open accounts for their tenants, customers, clients Account opening is done at partner locations By authorised and trained staff ID is taken and verified Overcomes all barriers to account opening

Trusted Partner Process Initial agreement is made Due diligence Management sign off Trusted Partner Agreement is entered into Implementation plan is set Trusted partner app is downloaded onto TP system Training of front line staff – AML and Data Protection

Accessible During any relevant meeting, banking checklist is used & if alternative is required, the account is opened – total time 2 minutes Account appears on our system within 15 minutes A call is made from service centre within 24 hours Explain our service and credit union, Confirm T&C’s Set up payments in and out if required Set up savings plan Order card Send welcome pack Diary for next contact

Products and services 4 transactional accounts planned from April Savings Manager with savings plan and debit card Rent Direct / Power Direct – single payee, savings plan and card Budget Account – household bills, savings plan & card Debt Management plan – household bills, debt payment plan, savings plan and card All have sort code and account number Regular payments and direct debit capability

Low cost, high impact Access points at partners through Kiosks high visibility multiple use easy to use Members assistance plan – debt, legal and medical emergency advice Proactive calls Relationship managed by service team statements Secure on line area Mobile app Monthly text balances

A real alternative to banking – yes A solution to use of high cost lending.... Range of affordable loans Balanced and segmented loan books Clear credit risk strategies Relationship lending - Instant decisions, smaller loans, and revolving facilities Credit unions promote thrift and financial well being Responsible lending is based upon affordability

Some solutions – insulate from financial shocks in household Simple savings plans for all – lets remove the societal need to have to borrow every time you have a minor emergency. Savings plans from payroll should be a right. Refer to advice and support agencies where more appropriate

Solutions from partnering: Social landlords to provide indemnified loans for tenants – small revolving loans where rent is being collected Work with CDFI’s Insulate household from other financial risks.... Brian Hall