We have often been asked, ‘What actually is a building society?’ and ‘Why am I a Member and not a customer?’ These are very good questions and we’re happy to explain these and a few other things, that make a building society very different to a bank.
What is a building society?
Building societies are financial organisations often referred to as ‘mutuals’ as they are owned by their Members. This means that every borrower or saver of a building society has a say on how the society operates, that’s why they are referred to as ‘Members’ and not customers. This is different to a bank, as they are normally listed on the stock exchange and as such must operate to the benefit of its shareholders. A building society is still run as rigorously as a bank on the high street, but it is run for the benefit of Members and makes its business decisions in a different way because of this.
How does a building society work?
Put simply, when someone saves with a building society, they are given interest on every pound that they save, this money is then lent out as a mortgage and the borrowers are charged interest for this.
Chorley Building Society began in 1859 in order to help local mill owners own their own home. If you’d like to know a little more about Chorley’s history click here
Over 162 years later we are still helping people all over the country own their own homes. If you’d like to see our current mortgage range click here
What else is there to know about a building society?
There are currently 43 building societies and six credit unions* in the UK. The majority of building societies ensure that their profits go straight back into the society. This means that the Society is run for the benefit of the Members. Most societies also focus on their local communities, supporting a range of grassroot activities and also local charities and community groups. Chorley Building Society supports its local community in a number of ways, including our Chorley High Five initiative. To find out more click here
We think it is important that our Members know how we are different to a bank, after all we answer to you!
*BSA as of 31 March 2021