Credit unions ‘becoming like banks’

ASHTON TURNEY, a former president of the Barbados Co-operative Credit Union League Ltd, the umbrella body for local credit unions, is concerned that some of these cooperatives are increasingly operating like banks.

He view is that “there appears to be a growing practice of treating members’ applications for assistance in the same light banking agencies adopt”.

“Banks are in the business of making money at all costs, while credit unions are in the business of helping members to achieve their dreams,” he said.

“It goes without saying that to survive credit unions need to make a profit and the membership is aware of that need and express the appreciation of that reality every annual general meeting.”

Turney has served as a director and vice-president of the Caribbean Confederation of Credit Unions, asserted that credit unions’ hiring practices “no longer considers connections with unions or credit unions, so that employees can boast of not being members of neither a union or credit union”.

“Our lending policies have moved closer to the terms and conditions of the banks and other lending agencies and our services. A 2019 paper entitled Credit Unions, Cooperatives, Sustainability And Accountability In A Time Of Change: A Case Study Of Credit Unions In Cyprus . . . argued that credit unions . . . departed from adherence to the founding principles,” he noted.

“They are run by the employees for the benefit of the credit union (performance) rather than by the membership for the community (mutual well-being).”

He added that the authors “wanted to know if credit unions had adhered to the principles and the membership maintained a guiding influence, would they have remained independent, through the financial crisis is a matter for conjecture.

“What is far more certain is that credit unions, do not offer the utopian alternative that many had alluded to post the

2008 crisis. Co-operatives, their underpinning rationale and guiding principles, were, as noted previously, proposed as an alternative means of delivering financial services.”

Continuous message

Turney argued that “commitment to the cooperative spirit seems to have disappeared and credit union members must find ways to restore it and if it is not then it must be a continuous message”.

He illustrated the importance of credit unions to their members, pointing out that “credit unions continue to provide workers with opportunities, and without their presence that would remain only a dream”.

“Not that financial benefits are all that individuals and families need but often the availability of adequate financial assurances can make life less strenuous and open to enjoyment of other benefits,” Turney observed.

“Credit unions have become critical to the advancements of the working class to the point that some of them have now moved into decision making positions and appear to be without knowing it heading in a direction that undermines the philosophy that gives life to the movement.

“The brother and sister terminology within the movement, particular in the context of solidarity and community, is rooted in the cooperative movement’s historical emphasis on collective action and mutual support.

“These terms were often used to evoke a sense of shared identity and purpose among members, emphasising the idea of people helping each other.” (SC)

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