Credit unions

Credit unions or savings and credit cooperatives (SACCOs) are legally constituted not-for-profit co-operative financial institutions chartered and supervised, for the most part, under national co-operative law and created to meet the basic financial service needs of primarily low and middle income citizens who generally cannot obtain these services through the existing banking system. They provide a means to learn the value of regular savings and wise use of credit. They are a form of economic empowerment, based upon an individual's ability to control and manage the financial institution which provides savings, credit and financial management.

Membership eligibility is usually defined in terms of some common affiliation, such as employment or residence. All members are owners of the enterprise and have equal privileges, opportunities and responsibilities. Typically a SACCO or credit union only accepts deposits from and grants loans to members. All members are equal owners of the enterprise and each has one vote in the election for committee members and the board of directors. Members of these elected bodies serve in an unpaid voluntary capacity.

Library Resources

resource title type year resource
Credit Union Revitalization in Liberia Case Study 2017 English (en)

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World Council of Credit Unions received funding via UNCDF’s MicroLead programme to revive the credit union system in Liberia through the development of four regional credit unions. This case study takes readers through their development, with a focus on Trust Savings Credit Union, one of the four regional credit unions, as well as examines the challenges and opportunities in expanding access to finance in a post-conflict environment and in the middle of the Ebola epidemic.

Credit Union Revitalization in Liberia  -  English (en)

Author UN Capital Development Fund (UNCDF)
Publisher UN Capital Development Fund (UNCDF)
Number of Pages 36 pp.
Primary Language English (en)
Region / Country Global
Liberia
Keywords Credit Union, Credit Unions, Savings
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Supporting Credit Union Development in Afghanistan: An Overview of Issues Important to the Development of Shari’a-Compliant Cooperative Finance Paper 2008

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This report is a product of desk research undertaken from March-July 2007. The study’s objective is to describe WOCCU’s efforts to establish credit unions in Afghanistan and to provide an overview of issues important to the development of Shari’a-compliant cooperative finance.

This paper discusses some of the work undertaken to achieve the start-up of the two credit unions (Balkh Savings and Credit Union in Mazar-e-Shariff and Jawsjan Savings and Credit Union in Sheberghan) and other developments under the project, focusing on efforts up to the start of the ARIES project. It will also identify problems that constrained progress and describe how these were or were not overcome.

Author Robert Wieland
Publisher WOCCU
Number of Pages 25 pp.
Primary Language English (en)
Region / Country Global
Keywords Credit Unions, Cooperative Finance
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Evaluating the Role of Peruvian Credit Unions: A Case Study of 8 Credit Unions Report 2006

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This report suggests that one of the most stylized facts of developing economies is that formal financial institutions leave the poorest population tightly constrained in their access to financial services. It is also widely recognized that economic progress relies largely on access to financial services such as savings, insurance, and credit. Where formal financial institutions fail the large majority of the poor population, there is evidence to support the proposition that credit unions can fill some of the gap.

The purpose of the report is to:

  1. Provide the Credit Unions with key marketing information regarding the members’ and non-members’ demographic, and economic characteristics, use of financial services and their perceptions of the credit unions as a financial institution.
  2. Highlight the differences between members’ and non-members profiles so as to guide the improving of services as well as implementation of new services.
  3. Identify Credit Union reach in terms of income distribution and poverty level.
  4. Provide a baseline dataset so that WOCCU can track the impact of the project over time in terms of savings behaviour, access to credit, membership levels, implementation of other services, the economic wellbeing of members, and the contribution of these credit unions towards poverty reduction in their region.

Section I presents a brief overview of Perú and the Credit Unions. A review of pertinent literature can be found in Section II. Section III follows with the survey design and implementation. The results of the survey can be found in Section IV. Finally, Section V concludes.

The survey’s main findings can be summarised as follows:

  • The survey results presented provides strong evidence that these credit unions play an important role in the provision of financial services to small business owners and salaried public or private employees.
  • The credit unions participation in the study provide strong evidence that they currently service low to low-middle income segments of the Peruvian population. All the credit unions in question need to expend outreach efforts to increase participation form the rural poor (below US$2 per day).
  • Credit unions also hold the dominant share of their members’ deposit accounts. In addition to mandatory shares accounts, most credit union members have additional savings accounts. In contrast only 20% of non-members respondents have savings accounts of any type.
  • In addition to promoting savings mobilization other factors are necessary to encourage broader non-member participation namely: Interest rates on deposits have to be more attractive relative to other formal financial institutions. And credit unions also have to improve their image as safe and secure institutions.
  • Most credit union members have some access to credit, however, a third of credit union member respondents were either partially or fully constrained in their access to credit. Furthermore, poorer members were more likely to face credit constraints. Only 46% of members participated in credit markets.
  • A great marketing effort needs to be in place to include the agricultural sector. The random sample of members selected for the survey reveals a very interesting pattern - only 8% of members cite agriculture as their primary occupation.
Why We Can No Longer Afford to Ignore Financial Cooperatives in the Effort to Increase Access to Financial Services Paper 2006

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This document aims to offer a number of elements to stimulate discussion on the role of powerful financial cooperatives as tools for increasing access by the poor to financial services. The paper suggests that in the wide-ranging debate within the microfinance community on sustainability and accessibility, financial cooperatives have never really entered the fray.

The authors argue that there of course problems within the cooperative sector but the problems lie mainly with specific institutions. For example, many cooperatives formed part of state policy to expand access to credit and have almost become “organs of the state”. Furthermore, there remains a lack of reliable supporting data on the extent of outreach of this sector and its performance.

Nevertheless, cooperatives are said here to be an “amazing” delivery mechanism when effectively networked. They are often organised in close proximity to the communities they serve and are often located in rural areas or in communities that are ignored by other institutions. The authors argue that when networked, each cooperative becomes a point of redistribution for the services and resources of the whole network (the effect of which multiplies the more the network is integrated and communication and interaction are facilitated.

The authors also note that cooperatives, by their nature, seek to increase local and collective wealth because they belong to their members. Furthermore, cooperatives often place more emphasis on savings mobilisation and the creation of local capital than do other institutions. The paper also discusses how the governance and performance of financial cooperatives is strengthened when they are organised into federated networks, as well as how cooperatives can be synonymous with sustainability and outreach.

Each section of the paper is illustrated with examples from different regions. The paper concludes by stating that those that will survive and effectively respond to the needs of the diversified clientele they serve are those that will:

  • be reorganised and be effective;
  • demonstrate transparency and rely on effective performance reporting and controls;
  • offer quality services delivered by qualified and loyal employees;
  • be interconnected and integrated in order to benefit fro the force of federation;
  • be able to optimise their cooperative advantages;
  • be rooted in their communities and look after their collective wealth;
  • be effective in dlivering their products and services due to the optimisation of their distribution network and to a diversified and progressive offer of services.
The effects of wholesale lending to SACCOs in Uganda Report 2006

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In Uganda cooperatives developed to support farmers involved in the production and marketing of cash crops like coffee, cotton and tobacco. Many rural cooperatives received subsidies from the GOU throughout the 1970s but trade liberalization, increased competition in world markets, and corruption caused the collapse of many of these producer cooperatives. In Uganda, only a small number of cooperatives survived and many rural farmers and workers were devastated by the failure of the cooperative movement. After almost a decade of recovery, local communities began forming savings and credit cooperatives (SACCOs) in rural and urban areas.

Currently, Uganda has about 628 operational, registered SACCOs with permanent fixed locations. In recent years, a number of agencies (donor-funded, governmental and private) have made lines of credit available to member-owned, savings-led institutions for the purpose of on-lending to SACCO members. The GOU has publicly supported this type of intervention in order to facilitate the development of rural regions by giving the rural poor increased access to financial services. However, local and international SACCO experts with long experience in the matter have cautioned the industry that imprudent on-lending to member-based, savings-led institutions can have a deleterious effect on the financial performance and organizational culture of such institutions.

This study was set up to:

  • Review the experiences of Ugandan SACCOs with wholesale lending;
  • Determine the factors that influence whether a loan from a credit wholesaler will have a positive or negative effect on a SACCO; and,
  • Give practical advice to on-lenders and potential borrowers

The report concludes that external funds will not help a weak SACCO become strong. Wholesale lenders risk doing more harm than good when they lend to SACCOs which have weak management capacity, ineffective governance structures or a poorly performing portfolio. However, the injection of wholesale loans into a SACCO does not always have a negative effect on savings. The change in a SACCO's savings rate (whether positive or negative) is more dependent on the management and governance structures and on the capacity building and support given to the SACCO by external agencies than the injection of external funds. In the weak SACCOs in the study, external credit changed the orientation of the institution from a savings-led SACCO to a loan disbursement institution resulting in a deterioration of the quality of the loan portfolio and amount of member savings.

Since problems in wholesale lending are closely tied to issues of governance and management, the author believes resources that are available for capacity building should be used more efficiently. There is considerable anecdotal evidence of a lack of coordination among service providers leading to inequalities in the amount of technical assistance, redundancies and overlaps, contradictory messages, a mismatch between needs and assistance given, a lack of planned sequencing, lack of accountability and conditionality among recipients, and a disconnect between institutional assessments and assistance given.

External funds can encourage better reporting procedures but unfortunately, most SACCOs do not see the inherent value in these procedures for the enhancement of the SACCO. The aging of loan portfolios and provisioning for loan losses, for example, are seen as tedious or adding further costs, and not as improving the capacity and performance of the institution.

Failures of Cooperatives Paper 2005

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In this paper Zvi Galor discusses and analyzes some features which he believes are behind the failure of cooperatives in general and in Africa in particular. He thinks that fundamental cooperative principles are ignored and they are often mismanaged or taken over by governments or NGOs. Zvi also believes that SACCOs can be a useful tool for development if the credit they can give is complemented by training in financial planning, e.g. profitability calculations and cash flow budgets, although he also emphasises that it will not be possible for all traditional, small farmers to become successful modern ones. Finally Zvi recommends how he thinks SACCO savings and share accounts should be restructured.

The savings-credit cooperatives in Peru and Ecuador and the development of rural financial services Article 2005

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This article explores the role of savings and credit cooperatives in extending financial services to rural areas in Latin America. In Ecuador, the savings and credit cooperatives are second only to the banks in the financial sector. They have over 550 selling points - and handle 10% of the national financial transactions. There are more than 430 cooperatives (37 of which are regulated by the Administration of Banks and Insurances) that serve about 1.800.000 clients, 60% of which are microenterprises (and 45% rural micro-enterprises). However, the majority of the cooperatives are predominantly urban. Cooperatives which only offer their services to members are not regulated but "open" cooperatives which offer services to members and non-members are supervised by the Administration of Banks and Insurances.

In Peru, savings and credit cooperatives were badly hit by the economic crisis of the 80s. In 1998, only 176 of the 600 cooperatives registered in 1991 were still operational and most of them dealt exclusively with outstanding debts. The sector has been improving recently but only a few savings and credit cooperatives focus on rural areas. However, many activities of cooperatives located in the provinces, or in the towns, also concern rural populations. Since 1993, the Administration of Banks and Insurance (SBS) has delegated its role of supervising savings and credit cooperatives to FENACREP – the national federation of savings and credit cooperatives - because the cooperatives are only permitted to provide services to their members. The cooperatives must be registered with SBS, which supervises and controls FENACREP, but nevertheless they are excluded from the protection that other formal financial institutions receive as a result of SBS control.

The article observes that the cooperative model has important advantages for the supply of financial services in rural areas, e.g. their strong local base, low costs and ability to offer a wide range of services. Among their challenges, however, are the quality of governance and the ambivalence created by members being both owners and beneficiaries of the services provided. The relatively small size of cooperatives limits their profitability and the fact that most are excluded from adequate prudential regulation leaves peoples' savings at risk. A lack of skills could lead to the disappearance of a large number of cooperatives, leading to growing concentration in the sector and to the emergence of large cooperatives, as is currently the case in Peru. This trend goes counter to a system that is based on small cooperatives with a strong local basis, as is the case in Ecuador. The survival of this type of «cooperative of proximity » relies on the building up of adequate management skills.

Casos exitosos de Cooperativas Rurales de Ahorro y Crédito Book 2004

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Innovación y Éxito en la Gerencia Cooperativa: Casos exitosos de Cooperativas Rurales de Ahorro y Crédito

Este libro en versión electrónica presenta de manera detallada la experiencia de las cooperativas rurales de ahorro y crédito en Colombia y sus buenas prácticas de gestión, a través de dos casos de estudio correspondientes a dos cooperativas que funcionan de manera exitosa en dos valles rurales del país.

El libro se encuentra dividido en cuatro capítulos. El primero brinda una reseña del medio social, económico y cultural predominante en la región donde se encuentran las cooperativas estudiadas. Se presenta un resumen de las principales características que tiene la economía y la sociedad campesina del sur de Santander, haciendo énfasis en los dos municipios en los cuales se ubican las cooperativas, Valle de San José y Guadalupe. Este capítulo es complementado con una reseña del sistema de economía solidaria en el país, tomando como fundamento las principales variables que pueden trabajarse teniendo en cuenta la base de datos que maneja la Confederación Colombiana de Cooperativas.

El capítulo dos, de carácter conceptual, permite dar apoyo, claridad, orientación y precisión conceptual a los interesados y relacionados con la dirección, el control y la promoción de organizaciones cooperativas, solidarias y asociativas, a fin de que, conociendo las ventajas y desventajas que el modelo contiene, se pueda fomentar una gestión realmente eficaz. Este capítulo contiene una serie de elementos conceptuales clave que permiten un mejor entendimiento de los casos de estudio posteriores, se analiza el concepto de la cooperativa y sus características particulares, en especial dentro del contexto colombiano.

En el capítulo tres y el capítulo cuatro se exponen los dos casos de estudio. En el capítulo tres se presenta el caso de la cooperativa de ahorro y crédito del Valle de San José, un caso de innovación en proceso de consolidación. Las innovaciones que se han producido en este caso se manifiestan de diferente manera en los niveles funcional, estructural, de comportamiento y relacional. La experiencia que se desarrolla en relación con los proyectos productivos y el plan de asistencia técnica y social, que actualmente se ofrecen como nuevos servicios, es una demostración del potencial local que tiene este tipo de organizaciones para dinamizar la economía local y mejorar el nivel de vida de la comunidad implicada.

El capítulo cuarto se refiere al estudio de caso de Multicoop Ltda., una cooperativa de primer grado que ofrece servicios de ahorro y crédito en el municipio de Guadalupe. Este caso de estudio puede considerarse como una innovación de carácter gerencial en proceso de consolidación. Es un buen caso para demostrar la necesidad del equilibrio entre los fines económicos y sociales, para no disminuir el potencial que tiene la organización cooperativa.

El capítulo quinto presenta el análisis de los resultados obtenidos en los dos casos de estudio, enmarcados en los rasgos comunes que identifican a la organización y a la gestión innovadora y exitosa. Estos rasgos emergen a partir de una serie de temas centrales que se han venido analizando de manera previa por un proyecto de investigación anterior al descrito en este libro:

  1. Las interfases entre lo público y lo privado;
  2. Los serios interrogantes sobre la relevancia del modelo organizacional y gerencial de la gran corporación multinacional en países en desarrollo;
  3. El poder de la acción colectiva de las bases como forma genuina de participación diferente de los modelos jerárquicos de participación;
  4. El papel clave que juega en la gestión, la capacidad de edificar sobre la cultura local y regional;
  5. El papel del líder y sus rasgos principales; y
  6. El énfasis en el servicio a una misión organizacional.
Saving and Credit Cooperatives: a New Conceptual Approach Paper 2003

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In the view of the author, credit and saving cooperatives around the world are facing serious and fundamental problems. These include basic concepts relating to the nature and aim of the cooperatives, their structure and the principles under which they operate. Mr Galor explains his view of the nature of credit and savings cooperatives and how they should set interest rates, safeguard members savings, deal with surpluses and, if possible, provide marketing services to ensure loan recoveries.

After describing how he thinks a savings and credit cooperative should work, the author continues to analyse problems that have arisen in other countries because they do not follow fundamental principles. He highlights issues such as failure to pay proper interest on savings, lack of incentive to reduce operating costs, misunderstanding of share capital and surpluses, interest charges on loans being too low, etc. He gives particular attention to the remuneration of the cooperative manager and recommends paying a percentage of the cooperative’s revenue to provide motivation for good management, including adequate loan recovery.

Mr Galor concludes this paper by reviewing his commitment to cooperatives playing a comprehensive role in rural development. He outlines different forms of cooperative, including multi-purpose societies and federations and the role each can play. He believes credit and saving cooperatives are a vital form of organization in the particularly in the developing countries of the world.

Accounting Norms and Principles Guideline 2003

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This brief paper describes the purpose of an accounting system as a tool to provide credit union management with complete and accurate financial information that can be used to operate the credit union safely and effectively. It notes that accounting effectiveness can be enhanced with the use of accepted accounting principles that address day-to-day credit union operations including:

  • proper methods for handling member’s transactions;
  • accurate recording or transactions in the books and records;
  • proper receipt and disbursement of funds; and
  • preparation of financial statements in a manner that reflects the current financial position.

It is also stated that accounting records also serve as a basis for reports t the members and interested third parties. Therefore, it is essential that the records be accurate, current, and reveal the true financial condition of the credit union.

This paper sets out key terms, norms and principles used in accounting, and provides definitions and explanations of each point with respect to credit union management.

Author World Council of Credit Unions
Publisher WOCCU
Number of Pages 9 pp.
Primary Language English (en)
Region / Country Global
Keywords Cost Accounting, Financial Management, Record Keeping, Bookkeeping
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Model Credit Union Bylaws Guideline 2003

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Every credit union must submit proposed bylaws as part of its licensing process. Bylaws at a minimum define:

  • the credit union's field of membership
  • the requirements for membership
  • the scope of the credit union's activities
  • the services a credit union can offer
  • the duties and responsibilities of its officials and operational management

Every regulatory body charged with credit union supervision and regulation should produce model bylaws to help the development of new credit unions. Model bylaws act as a guide for individual credit unions to follow and allow for some standardisation in credit union operations.

A board of directors should formally adopt their proposed bylaws once they are approved by the regulatory authority and they receive their licence or charter. All officials and management of a credit union should be familiar with their particular bylaws.

This guideline goes on to give a recommended outline of what should be contained in model bylaws, section by section.

Author WOCCU
Publisher WOCCU
Number of Pages 3 pp.
Primary Language English (en)
Region / Country Global
Keywords Credit Unions, Governance, Bylaws
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Operational Management Duties and Responsibilities Guideline 2002

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This short guideline points out that the board of directors delegates full responsibility over the daily credit union administration and operations to the general manager. In turn, the general manager reports directly to the board. Furthermore, the general manager’s responsibility includes supervision of the credit union employees.

It is noted here that credit union managers should have experience in managing financial institutions and employees and a financial or business background and that their duties and responsibilities should be clearly stated in writing.

The guideline sets out the duties and responsibilities of operational managers. The list assumes that the manager is not the only employee – the credit union has an accountant, loan officer, collector and a cashier.

Board of Directors Duties and Responsibilities Guideline 2002

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The guideline highlights that the board of directors, usually serving on a voluntary basis, is elected by credit union membership during the annual general meeting (AGM) and reports to the general membership. The board of directors is part of the overall management team that includes a supervisory or audit committee and a credit committee, and has the ultimate decision making authority and responsibility for directing and controlling the affairs of the credit union and providing effective and efficient management of overall operations. In doing so, it approves policies that direct operational management and delegate the necessary authority to staff so they can fulfil their job responsibilities.

The guideline proposes that duties and responsibilities should be clearly stated in the job description given to all perspective board members so that expectations are perfectly clear. It sets out a list of items that should be included in the job description of each member.

Credit Committee/Loan Officer Duties and Responsibilities Guideline 2002

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The credit committee is usually elected by members at the annual general meeting (AGM) or appointed by the board of directors – and mostly made up of not less than three or more than five members. It also usually serves on a voluntary basis and reports to the membership or the board of directors, depending on whether they were elected or appointed.

This short guideline notes that in some countries there exists a clause in the bylaws that allows the credit committee to delegate the powers to loan officers. Since loan officers are experienced professionals they are able to grant more complex loans and the credit union can provide more complex loan products to the membership. The guideline argues that as credit unions grow the array of loan products offered, the use of professional loan officers instead of the credit committee is a good business decision.

The guideline separately sets out and describes the duties and responsibilities of loan officers and of credit committee.

Author World Council of Credit Unions
Publisher WOCCU
Number of Pages 4 pp.
Primary Language English (en)
Region / Country Global
Keywords Credit Committee, Loan Officer, Credit Check
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Supervisory Committee Duties and Responsibilities Guideline 2002

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This short guideline notes that the supervisory committee’s principal objectives are to perform, or select a qualified individual to perform the annual audit, member account verification, and periodic internal audits of operational areas throughout the year. It stresses that because of the technical nature of the supervisory committee it is imperative that the elected committee members have “hands on” experience in accounting and auditing. Very few committees are capable of performing the auditing procedures nor do volunteers usually have enough spare time to adequately perform the necessary audit steps. However, many newly chartered or small credit unions cannot afford an external auditor, so their only option is to have the supervisory committee perform all auditing functions.

It is suggested here that the supervisory committee should only be allowed to perform the audit if operations are simple. That is, the credit union offers only the most basic of services such as short-term consumer loans, ownership share accounts, term deposits, no cash on site, limited or no investment in fixed assets, etc.

Hence, the note states that if the supervisory committee is to perform the auditing functions, then each member should fully understand their duties and responsibilities. This note sets out items that should be included in the job description of this committee.

Internal Control Requirements Guideline 2002

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Internal controls are mechanisms, policies, and procedures used to minimise and monitor operational risks. In order to deter employees and/or members from committing a dishonest or fraudulent act the controls must be thorough and comprehensive. However, internal controls by themselves are not enough. They will be effective only if they are reinforced by the credit union’s culture, policies and procedures, information systems, training, and supervision of staff.

This short note observes that fraud is usually perpetrated by falsifying or altering documents, embezzling funds, omitting the effects of transactions, recording nonexistent transactions, and/or incorrectly using accounting policies and procedures. Weak internal controls not only allow for the perpetration of fraud but allow for errors and unintentional mistakes to go undetected for a long period of time. Usually these errors individually do not represent a large amount of funds. However, the cumulative total can be material and the time needed to correct the error significant.

Furthermore, it is noted that the primary objective of internal controls are to:

  • safeguard assets and member savings;
  • verify the efficiency and effectiveness of the operations;
  • assure the reliability and completeness of financial and management information;
  • prevent fraud and mistakes; and
  • ensure compliance with applicable laws and regulations.
  • This guideline breaks internal controls into two categories – accounting controls and administrative controls – and sets out the main mechanisms for the effective implementation of each type.
Author World Council of Credit Unions
Publisher WOCCU
Number of Pages 6 pp.
Primary Language English (en)
Region / Country Global
Keywords Cost Accounting, Internal Controls, Fraud, Agricultural Finance Risk Assessment
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Strategic Planning Guidelines - Credit with Education and Credit Unions Guideline 1999 English (en)

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Freedom from Hunger have pioneered a methodology for credit unions to implement a "credit with education" strategy for rural women. Since credit unions are already community-based, member-owned institutions with concerns for achieving social as well as financial goals, the approach is not a radical departure from their normal operations.

The core of the system is a credit association of 16-36 women who agree to come together to borrow money, deposit savings and participate in an education programme. The education programme consists of 3-8 highly interactive and participatory learning sessions covering health, nutrition and business development topics.

These guidelines are designed to:

  1. enable credit unions to assess their capacity and interest in developing a "credit with education" service;
  2. provide step-by-step instructions for developing the service.

There is a companion volume which is a Technical Assistance Guide for development agencies to use when assisting credit unions to introduce the service.

Freedom from Hunger  -  English (en)

Author 1999
Number of Pages 81 pp.
Primary Language English (en)
Region / Country Global
Keywords Credit Union, Education, Strategic Planning
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Nicaragua Financial Services to Microentrepreneurs: A Study of Rural Credit Unions Paper 1999

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In Nicaragua, credit unions offer access to capital and savings mechanisms to poor, rural entrepreneurs. Capital enables the entrepreneurs to grow their businesses and savings mechanisms generate greater liquidity for the enterprises and the households. This paper is the result of a study by USAID and WOCCU who have been working to expand the financial services of Nicaragua's rural credit unions in a project which started in 1996. The experiences of six high growth credit unions with microenterprise financial services were reviewed.

These credit unions offered flexible, customised lending to meet the needs of first-time and small borrowers. In particular they provided:

  • Flexible collateral and capacity-to-pay lending criteria for loans of less than $500
  • Monthly, bi-weekly, weekly or daily loan repayment plans
  • Stepped or graduated lending to first-time loan applicants and those with limited capacity to pay.

It is interesting to note that more than 56% of the microenterprise loans were to women.

The study found that these credit unions were filling an unmet need for rural micro entrepreneurs. Borrowers reported that the credit unions' services were more convenient and provided faster turnaround on loan requests than other agencies. They had been able to obtain discounts on purchases and "wait for their price" on non-perishable goods, as well as generate additional earnings on savings.

Author Mahon, C.
Publisher World Council of Credit Unions, Inc. (WOCCU)
Number of Pages 36 pp.
Primary Language English (en)
Region / Country Global
Nicaragua
Keywords Credit Unions, Financial Services, Enterprise Development
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The Role of Credit Unions in Salvadoran Financial Markets: Expanding and Improving the Delivery of Financial Services to the Rural Poor Report 1998

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In 1996, WOCCU conducted two surveys of members of 14 credit unions participating in the Rural Financial Enterprise component of the El Salvador CRECER project. The two surveys were a baseline household survey of members and a marketing survey of members and non-members.

They discovered that to maximise savings mobilisation, the credit unions needed to target the 45-55 age group and to attract more male members. They would also have to compete better with banks who were seen by many to have more convenient locations, and to provide more security, better access and better returns on savings. There is obvious scope for increasing deposit mobilisation because 35% of non-members interviewed did not use savings services at any financial institution. There is also scope for new products because many members wanted their credit unions to offer bill-paying services.

This study provides an example of the sort of information market research by credit unions can produce.

Author Mesbah, D.; Hernádez, A.; Tercero, R.
Publisher World Council of Credit Unions, Inc. (WOCCU)
Number of Pages 25 pp.
Primary Language English (en)
Region / Country Global
Keywords Credit Unions, Market Research
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Credit Union Best Practices Website English (en)

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Credit Union Best Practices  -  English (en)

Primary Language English (en)
Region / Country Global
Keywords Credit Unions, Governance, Financial Management, Financial Regulations
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