Friendly societies are one of the oldest types of financial service organisations and have been around for hundreds of years. Here, we take a trip down memory lane and look at the history of Sheffield Mutual...
Friendly societies came to the fore following the industrial revolution in the 18th century and their popularity grew from the simple premise that if a group of people contributed to a mutual fund, they could receive benefits at a time of need - particularly illness, death or unemployment of a household’s breadwinner.
In 1875, friendly societies were acknowledged by the government under the Friendly Societies Act 1875 and membership was encouraged as new systems of auditing and registration were introduced. People joined in large numbers and by the late 1800’s, there were around 27,000 registered friendly societies across the UK in towns and villages.
Between 1911 and 1948, friendly societies administered the state sickness benefits scheme for working people for whom membership of a friendly society was compulsory under the National Insurance Act of 1911. By 1945, before the nationalisation of the Welfare State, 14 million people, mainly male workers, were members of friendly societies. Numbers fell when the welfare state was nationalised in 1948, and the NHS as we all know today was introduced.
Friendly societies struggled to survive and had to adapt their offering to meet the needs of new members. Today, there are around 140 friendly societies registered across the UK offering savings and investments, income protection, life cover and private medical insurance products to their members. Many have names which reflect their origins and are locally based but others, such as Sheffield Mutual, have grown significantly and offer their products to members nationwide.