FAQs In this section Explanation of Withdrawable Share Capital in a Consumer Retail Co-op Society FAQs Terms and Conditions Code of Practice Is there a minimum/maximum amount and what will be the rate of interest? By committing a minimum of £1,000 (maximum of £100,000) for a fixed 3-year term, you will receive interest, paid gross, at the rate of 2.5% (with the option to donate 0.25% of this for community investment). When will the interest be paid? The interest will be paid at the end of the 3-year term. If the capital is withdrawn prior to the end of the 3-year term interest will be calculated at the Society’s, then standard rate (currently 0.5%). Do I need to be a member of the Society? To be able to acquire fixed term withdrawable shares you will need to be a member of the Society (and remain a member of the Society during the fixed term). Will I receive any additional rights as a member if I hold fixed term withdrawable shares? If you hold fixed term withdrawable shares your rights with be the same as those of non-fixed term shareholder – other than the rate of interest that you receive on the fixed term shares held. Can I purchase further fixed term shares during the fixed term? You are unable to change the value of the fixed term shares held during the fixed term. If you wish to purchase additional fixed terms shares these will be treated separately and have their own fixed term applied. Can I reduce the amount of fixed term WSC held within the fixed term? You are unable to reduce the value of WSC held under a fixed term – however you can terminate the fixed term at any time and withdraw the share capital (unless the Society’s Board has removed this facility under the Society’s Rules). Please note that if you terminate the fixed term prior to completion you will only receive interest on the capital held at the Society’s then standard rate. Are you part of the Co-op Bank? The East of England Co-operative Society is an independent Co-operative Society and not part of the Co-operative Bank. Is there any risk to holding fixed term withdrawable shares? As a member of the Society you are the owner of one or more shares in the business. If the Society is unable to meet its debts and other liabilities, you risk losing the amount you hold in shares. Hence these are known as risk capital. This may make it inappropriate for you as a place to keep your savings. Please also see below regarding the Financial Compensation Scheme. Will the value of my shares increase? Holding withdrawable share capital is not the same as investing in the shares of a company. It is primarily for the purpose of supporting the Society in furthering its purpose and objects. There are various important differences between WSC and company shares. For example, WSC held with the Society will receive interest but not increase in value. Is my share capital protected under the Financial Services Compensation Scheme? The Financial Services Compensation Scheme, which covers bank, building society and credit union accounts, does not apply to your Share Account including any fixed term WSC held. Therefore, you are unable to claim compensation under the Scheme in the event that the Society is not able to meet requests for withdrawal of shares. This is because the Society does not require authorisation under the Financial Services and Markets Act 2000 to operate WSC. Societies are therefore not subject to supervision either by the Prudential Regulation Authority or by the Financial Conduct Authority in relation to WSC. Can I raise a complaint to the Financial Ombudsman? The Financial Ombudsman Service does not apply to your Share Account including any fixed-term WSC you hold, or your relationship with the Society. Under the Society’s Rules any dispute between the Society and a member is to be submitted to an arbitrator agreed by the parties, or in the absence of agreement to be nominated by the Chief Executive of Co-operatives UK Limited. The arbitrator’s decision will be binding and conclusive on all parties. Will I receive a statement each year? You will receive a statement at the end of each year of the fixed term. Definition of AER The annual equivalent rate (AER) is the interest rate for a product that has more than one compounding period. That is, it's calculated under the assumption that any interest paid is included in the principal payments balance and the next interest payment will be based on the slightly higher account balance. As all advertisements for products of this nature quote an AER, it allows you to compare what interest you can expect from the Withdrawable Share Capital that you hold with us more easily. What does Gross mean? Gross is the contractual rate of interest payable before the deduction of income tax. Can I transfer my fixed term withdrawable share to someone else? What happens if I die before the Fixed term ends? No, only upon death of the member would a transfer be allowed, and then their personal representative will be the only person recognised by the Society as having title to the WSC. Once all formalities are completed, we will pay interest on your WSC up until the date the payment is made to the estate’s personal representative. Can I obtain fixed term WSC against my account in someone else’s name e.g. my grandchild? No – the WSC can only be held in the same name and address as the account holder.