Should Christians save with a secular bank?

Do we need a Christian bank?

I am regularly asked – do we really need a Christian bank?

My answer is an emphatic “Yes!”

Secular banks don’t do churches 

Most secular banks won’t lend to a church.

It’s nothing personal or anti-Christian – it’s just that churches are a niche market which is outside their field of understanding. They can’t distinguish between the two thirds of churches which the media regularly reminds us are rapidly closing, and the one third of often broadly evangelical churches which are very much alive and growing. And the banks have a point – if you can’t tell the difference between them theologically, you certainly shouldn’t be lending them money over a 30-year term.

Imagine you’re an elder of a church who needs to buy a building to enable more ministry. First off, you’ll find that most banks won’t explore mortgages for churches. And of those banks which are willing to open a conversation, they will ask about the certainty relating to your income.  When you explain that almost all of it is a combination of regular and one-off charitable giving – non-contractual income from church members – the conversation will often come to an end.

Churches’ theology and charitable giving are outside most banks’ field of understanding. Therefore, most banks will consider most church mortgage applications too high a credit risk, and they will politely turn you down.

The demand for church mortgages is growing 

UK churches are our market. We seek to provide evangelical churches with the most affordable mortgages they can get, and we understand how church finances work. Furthermore, the demand for church mortgages is growing.

Issues in the Church of England (C of E) have caused many churches to buy buildings (especially residential property) outside of C of E structures, and the increasing secularisation of society is causing independent churches to consider that rental of public buildings (such as schools) may not be possible in the long term.

Over the past five years, we’ve approved over £100m of mortgages to churches; and over the next five years we expect to approve over £250m of mortgages. Each of these mortgages represents a property being purchased and/or developed to serve the Lord Jesus Christ and to share his gospel in local communities.

Pete Brown of Redeemer Church Nottingham said, “When the time came to refinance our high street mortgage, we found Kingdom Bank to be the best option due to:

Affordable rates – the savings on repayments allowed us to hire additional ministry workers. This has been transformational for our gospel impact.

Understanding the Church – unlike high street banks, Kingdom Bank grasped the nuances of our church finances and giving patterns.”

We need your help

Banks lend to their mortgage customers out of the funds their savings customers hold on deposit.  That’s how banks work – and it’s at the heart of the UK financial system designed both to keep our savings safe and to enable us to buy a home in which to live.  As part of this highly regulated system, Kingdom Bank is no different from any other UK bank.

We need you to save with us so that we can keep serving churches. We can offer churches affordable mortgages because Christians choose to save with us for a modest rate of interest. We pass on the benefit to our mortgage customers so they are not burdened with unaffordable debt and can focus their resources on the thing that matters most – reaching souls for Jesus.

The only way we can meet our expected £250m demand for church mortgages over the next five years is by substantially growing our level of deposits and savings. Lots of churches are supporting the mission: around two thirds of the deposit balances we hold are from churches and Christian ministries. But that alone won’t meet the need over the next few years. Indeed, our expectation is that most of our deposit balance growth over the next five years will come from individual Christians.

The one reason you shouldn’t save with Kingdom Bank

If Jesus is Lord, and he’s entrusted you with some money (savings) to steward, can you think of a good reason why you wouldn’t keep your savings with Kingdom Bank? ​

I think there’s one good reason. If you are really dependent on maximising interest on your savings to put food on the table, then it’s probably right for you to be shopping around to get the best possible rate every month or so. At Kingdom Bank our aim is for our best interest rates to hold a mid-table position in the savings accounts market. Our rates are not the best available. So, if you need a top rate of interest to put food on the table, then that’s a great reason not to put your money with us.

But, in reality, only a small proportion of us move our money around regularly for the best rates. Approximately 50% of UK adults have never changed their savings account provider.  Most of us have our money in accounts which pay a modest rate of interest (just like Kingdom Bank) … and we’re not concerned about it.​

From Christians who don’t need to maximise interest, the usual explanation I hear for not having opened a Kingdom Bank account is because they never quite got around to doing it – which feels like the type of answer Jesus was not enthusiastic about in the parable of the talents in Matthew 25:24-27!

What is your bank doing with your savings? 

Let me be a bit more provocative and ask another question: “What is your bank doing with your money?”  Most Christians I ask say, “I don’t know”.  ​

Really?!

The life savings God has entrusted them to hold for a period of time are being willingly handed over to an organisation that has little or no interest in serving the living God, and they don’t have a clue what that organisation is doing with that money.

A smaller proportion of Christians are a bit more informed.  They recognise that their bank is supporting some stuff God hates (things which drive addictions) and some stuff which perhaps can be described as “positive things” (maybe providing loans for local businesses or mortgages for people to buy houses).

But wouldn’t it be awesome to be able to entrust your money to a bank where you know that every pound is being used to support gospel ministry?

So, please, if you take nothing else away from this article – Think! – How am I stewarding (for eternal value), the savings God has entrusted to me?

Does Kingdom Bank have the same protections as high street banks? 

As a bank, our roots go back to the 1950s, so we really know what we’re doing. We assess risk carefully. We don’t lend money when a church shouldn’t be borrowing. As a consequence, as I write this I am pleased to say that no church mortgage is in arrears on its monthly mortgage payments. Not one.

We are also a fully regulated bank: we are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. As such, your savings are covered by the Financial Services Compensation Scheme (the Government’s insurance policy for banks) – that’s protection up to £120,000 per eligible depositor (or £240,000 for a joint account)​.

So, should Christians be saving with a secular bank? As I’ve outlined, there may be a good reason for doing so. But I think the more important question to ask here is this: how much more could my savings be doing for the Kingdom of God if I saved with Kingdom Bank?

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Kingdom Bank does not provide financial advice. Please seek independent financial advice when structuring your finances.

Mortgages subject to application. Your property may be repossessed if you do not keep up up repayments on your mortgage.