The story of the credit union movement started long before its governing act – the Corporate Societies Act – was adopted in 1971.
Credit unions can trace their history all the way back to the late 1840s.
In 1844, Robert Owen, an Englishman and Chartist, gathered weavers of Rochdale to save £28 out of their earnings to establish the first consumer co-operative. In Germany a co-operative mill, bakery and other corporate credit endeavours were organised by Hermann Schultz Delitzsch in 1848.
A hundred years later, in 1942, the first credit union was established in TT.
By December 1945 the Credit Union Society Ordinance had been passed. The first credit union was the Health Services Credit Union Society Ltd, where employees of the Colonial Hospital of Port of Spain were members.
Today, there are 129 active credit unions, with 120,000 members. Credit unions have a $3 billion asset base and contribute 5.6 per cent of the GDP.
Credit unions have also evolved to the point where their members enjoy the same benefits as banks, with loan products and facilities, technological frameworks to streamline members’ access to funds, and education and advisory modules to enhance members’ financial education.
With their multiple benefits, funding mechanisms and returns, Joseph Remy, president of the Co-operative Credit Union League of TT (CCULTT) is calling for legislation supporting credit unions to change to bring that same service and quality given to its members to the business community.
Section 10 (2) of the Co-operative Societies Act provides that an individual may be eligible to join a credit union. According to the Interpretation Act, the word “individual” does not refer to a legal entity. Therefore, legally, a legal entity such as a small business would not be able to become a member of any co-operative society
[caption id="attachment_982692" align="alignnone" width="305"] Joseph Remy president of the Co-operative Credit Union League. -[/caption]
“That is one of the sore points with us in the credit union movement,” said Remy, speaking to Business Day last week.
“Young members start their small businesses by taking a loan from the credit union. When the business grows to the point that it is registered, our argument is that we should be able to retain that business, and the business itself can become a member, so as a corporate entity, these businesses would be able to borrow money.”
But Jerome Chambers Co-operative development co-ordinator, in the office for the division for co-operative development said there is still much to consider if there were to be any legislative changes to include businesses, the first of which is, how members are selected for credit unions, as opposed to banks.
For banks, which have a profit-based business module, there is a list of requirements for entry, including measures under the Counter-Financing of Terrorism (CFT) and Anti-Money Laundering (AML) acts, but they are open to all entities, which
