The £1.1 million invested by North East Scotland Credit Union members will be returned

Members of a community savings scheme that has fallen into administration have been assured they will get their money.

Administrators were called in to the North East Scotland Credit Union this week after it was declared default.

The scheme’s more than 2,700 members have been informed of the closure, and guaranteed that their savings will be returned promptly.

Dina Devalia, of administrators Geoffrey Martin and Co, said it is unlikely that the Aberdeen based credit union would re-open.

"All of North East Scotland Credit Union's savers will have their balances returned by the Financial Services Compensation Scheme (FSCS),” she said.

"They don't need to do anything to get their money back; savers should look out for a letter in the post from the FSCS in the next few days."

Investments made in credit union of up to £85,000 – double for joint accounts – are protected by the FSCS. The scheme expects to return the £1.1 million which was handled by the union, and said most people will have their money within seven days.

Local politicians have expressed concern over the closure. Aberdeen North MP Kirsty Blackman said that extra assistance would be given to those on benefits who had savings in the union, whilst Aberdeen Central MSP Kevin Stewart said members deserved answers on the closure.

"More information needs to become available from the administrators and North East Scotland Credit Union including an explanation of how they came to be in this position so lessons can be learned,” he said.

The Association of British Credit Unions Limited has stressed that none of the other 330 savings schemes across Britain are affected by the closure of the North East Scotland Credit Union.