Posted on

Credit union sharing is a great step

shadiasimpson, [email protected]

Credit union sharing is a great step

Social Share

THAT CREDIT UNIONS in Barbados need to work together to improve service to become more efficient and remain competitive cannot be understated.
This is why we welcome the agreement announced last week where two of the major credit unions have decided  to work together sharing technology  for their members’ benefit.
The Barbados Workers’ Union  Co-operative Credit Union Limited  and the larger Barbados Public Workers’ Co-operative Credit Union Limited launched a co-branded CarIFS debit card which will be facilitated through the latter credit union’s banking system.
President of the Public Workers Credit Union, Glendon Belle, made some noteworthy comments when he highlighted the changing profile of credit union members, changing technology and the demands in the regulatory environment. All these things, he noted, pointed  to the need to “rationalize resources  to achieve efficiency and economies  of scale by levering what we have across the movement”.
We agree this cooperative spirit among the credit unions must start with the sharing of technology, but  should include the “back office” operations; legal services and even mortgage financing.
This recent agreement may be the ideal point for financial cooperatives to start working together rather than pushing the idea of establishing a commercial bank. The reality is that the community bank, which is what a cooperative bank would be, has been shrinking while the large banks have been growing.
We need from our credit unions  certain key deliverables: convenient service; lower interest rates and/or higher saving rates; lower or no fees; containment of loan losses; efficient management  of margins in a challenging interest rate environment; consistent payment  of dividends and interest rebates;  and meeting capital adequacy.
We also recognize that the credit unions as they leverage IT services must also consider other wider industry issues  which can determine whether they grow and are successful.
These include regulatory compliance under the Financial Services Commission (FSC); accepting the critical input  of a more enlightened and demanding  membership; and protecting members  from fraud which will become more sophisticated using the said IT.
The credit unions will also have to deal with attracting, managing and retaining top talent based on a meritocracy.
We expect that other areas of cooperation among  local credit unions must be forthcoming, but before we do so, this may be a good point where we should have a status report on all of them, to know if any are insolvent and how many meet all the requirements set out by the Financial Services Commission.  
We want growth and strength in our credit union movement which involves and impacts on so large a percentage  of our population.