The Guyana Cooperative Credit Union League is seeking to steer the local cooperative credit community in the direction of leveraging its $4.9 billion in financial assets base to raise its profile among local lending institutions by diversifying the range of services which it provides, beyond the conventional loans at low rates of interest, President of the League Denise M. Benjamin told Stabroek Business earlier this week.
Benjamin says the league, an umbrella advisory body to the country’s 30 credit unions is aiming to take the local lending institutions in the direction of raising both its standards and the range of its services to match those that exist in credit unions elsewhere in the Caribbean. According to Benjamin while the league favours the retention by credit unions of their traditional role of responding to the particular needs of its members, it wanted to see the institutions become “more provident and productive” and offer a much wider range of services.
General Manager of the league Dana Nestor told Stabroek Business the credit unions in other parts of the region had long diversified into other lucrative investments in the insurance and travel agency sectors, among others. She said that while some credit unions were limited in their ability to diversify the range of their services on account of their size and modest financial bases, the credit union family was probably in a position to move in that direction. Countrywide, membership of credit unions number approximately 35,000, a level that is low compared to elsewhere in the Caribbean where, in some cases, credit union membership numbers as high as one in every nine persons in the national population. She says part of the initiative of expanding local credit union membership would have to involve both the broadening of its range of services and more aggressive marketing of the services provided. “On the whole and while we do not wish to see credit unions lose their traditional focus we need to look at how we can make them wealthier so that they can better serve their members,” Benjamin said.
Yesterday, Thursday October 20, local credit unions joined the worldwide fraternity in celebrations to mark International Credit Union Day under the theme ‘Credit Unions Build A Better World’, while October 31 this year marks the start of the United Nations-designated International Year of Cooperatives.
Benjamin disclosed that some local credit unions had made investments in Clico prior to the financial organization’s spectacular collapse and while most of them had been able to retrieve what in some cases were “large deposits” in full, others were yet to be fully reimbursed.
Meanwhile, according to the league president raising the profile of local cfredit unions and enhancing the range of their services had to be preceded by regimes of institutional strengthening including the recruitment of specialized skills to meet the challenges of improving their effectiveness. On the issue of compliance with the principles of prudent and transparent financial management, she said she was satisfied that in recent years there had been significant improvement in those areas. “In some cases, credit unions are actually having their 2010 accounts audited,” she said.
Nestor, who currently sits on the Board of the Caribbean Confederation of Trade Unions, said she was satisfied that local credit unions could meet the standards of service currently being provided by credit unions elsewhere in the region though she conceded that some local institutions were not able to attract the skills necessary to ensure the raising of standards. She said credit unions needed to harness both the human resource base and the technology if they were to make the “transition” the league was seeking.
Meanwhile, Benjamin says she believes the profile of the cooperative credit union movement in Guyana may well have been negatively affected by the underperformance and, in some cases, failure of other types of cooperatives, over the years. “Other cooperatives which have benefited from special concessions over the years and which might have underperformed, having assumed a kind of laid-back attitude may well have influenced the limited growth of cooperative credit unions. “What is needed is an infusion of greater vision if the credit union movement is to go forward,” she adds.
And as part of changing the culture of borrowing, Benjamin says, the league is aiming to make credit unions the “credible alternative” to other lending institutions. “We want to build a level of confidence in credit unions that would cause our members to think of their credit unions as the first option for securing financial support,” Benjamin says.