A credit union set up to loan money to Waltham Forest Council employees, Forest Savers, has collapsed, reports Sebastian Mann, Local Democracy Reporter

Forest Savers was wholly independent from Waltham Forest Council but was aimed at its employees

The Waltham Forest Council Employee Credit Union (WFCECU), which trades as Forest Savers, entered administration on 19th August.

The Financial Services Compensation Scheme (FSCS) says that WFCECU has been declared in default, meaning it failed to make payments on time.

It acted as a financial cooperative for its members to save money via payroll deduction schemes or borrow through low-interest rate loans.

Their deposits are protected under the FSCS up to a limit of £85,000 per individual.

Dina Devalia and Terri Mulgrew, with the business advisory firm Quantuma, have been appointed as joint administrators and will wind the service down.

Devalia said in a statement: “Members of the Waltham Forest Council Employees Credit Union do not need to worry.

“Their money is safe and the FSCS will return 100% of members’ deposits, subject to the FSCS limit.

“We are working closely with the FSCS to ensure that all members will receive their money back as soon as possible.”

Any outstanding loans will still need to be repaid in line with contractual obligations, the WFCECU says.

A notice on the now defunct website reads: “You should cancel any direct debits or standing orders you currently have in place in relation to your savings.

“The joint administrators will write to all loan members confirming the administration bank details so that you can set up a standing order to resume your contractual loan repayments.”

A spokesperson for Waltham Forest Council said the Walthamstow-based service was neither owned by the town hall nor underwritten by it “in any way”. If the council had unwritten Forest Savers, it would be liable to cover any losses.

He added: “It was an independent organisation, which was open to staff members to use as well as other residents of the borough.”

The WFCECU office in Billet Road has been closed.

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