Capital Credit Union claims the move is a revolution in financial services.

Credit unions have traditionally offered services to people on low incomes and those who are excluded from other financial services by poor credit ratings.

However, the loans and savings co-operatives have been brought under the umbrella of the banking industry's watchdog, the Financial Services Authority.

Potential membership

Scotland is said to account for a large proportion of credit union members, with an estimated 130,822 people using them.

Credit unions used to be open only to public sector workers, community groups or association members.

A change in the rules means now they can apply for permission to extend their financial services to anyone living or working in their area.

The Capital Credit Union has been given the go-ahead to expand its potential membership to almost a million people in Lothian and Borders.

It expects to double its current number of savers and borrowers.

It wants to include company chief executives and other highly paid professionals as well as people who have been excluded from high street banks for poor credit ratings.