Know the facts about credit unions

Jamaica Gleaner - - INTERNATIONAL CREDIT UNION DAY FEATURE -

What is a credit union?

Credit union is a fi­nan­cial co-op­er­a­tive or­gan­ised for the sole pur­pose of pro­vid­ing ser­vice to mem­bers.

What is the dif­fer­ence between credit unions and other fi­nan­cial in­sti­tu­tions?

The dif­fer­ence is in the struc­ture. Other fi­nan­cial in­sti­tu­tions are owned by stock­hold­ers who seek to profit from their in­vest­ment in the or­gan­i­sa­tion. Credit unions are owned co-op­er­a­tively by all of their mem­bers with­out re­gard to the amount of money that a mem­ber has in the credit union.

Credit unions are directed by a board, which is a group of vol­un­teers se­lected from within the mem­ber­ship. Credit unions re­turn prof­its to their mem­bers in the form of div­i­dends, com­pet­i­tive loans rates and ser­vices.

Credit unions do busi­ness with their mem­bers only.

Who reg­u­lates credit unions?

Cur­rently credit unions are reg­u­lated by the Depart­ment of Co-op­er­a­tives & Friendly So­ci­eties on be­half of the Gov­ern­ment of Ja­maica. In the near fu­ture, credit unions will be reg­u­lated by the Bank of Ja­maica. The League, as the na­tional as­so­ci­a­tion for credit unions, will con­tinue to serve credit unions as man­dated by the mem­bers.

How does a credit union op­er­ate?

A credit union ac­cepts de­posits from its mem­bers and of­fers to them a range of fi­nan­cial ser­vices. Mem­bers elect a board of direc­tors at their an­nual gen­eral meet­ing. The board in turn em­ploys a gen­eral man­ager to man­age the day-to-day op­er­a­tions of the credit union. Credit union mem­bers may be elected to serve on com­mit­tees in the credit union.

How does a per­son ben­e­fit from be­ing a credit union mem­ber?

A credit union mem­ber is a co-owner of the credit union.

Each mem­ber has equal vot­ing power (one vote), the same as all other mem­bers in the credit union, ir­re­spec­tive of the amount of his sav­ings.

Each mem­ber has the power to ex­er­cise his/her demo­cratic right in de­ter­min­ing by whom and how the credit union is run.

A credit union mem­ber shares in any an­nual sur­plus.

Credit unions now of­fer a range of fi­nan­cial ser­vices, in some in­stances the same as those avail­able in other fi­nan­cial in­sti­tu­tions.

Mem­bers can de­ter­mine the type of fi­nan­cial ser­vices the credit union should pro­vide

Mem­bers are helped to save through the habit of thrift that is en­cour­aged by credit unions.

Mem­bers can save di­rectly and trans­act busi­ness at their credit unions through salary de­duc­tion fa­cil­i­ties.

IIIIIIIHow can I find a credit union to join?

Each credit union can serve only those peo­ple who are el­i­gi­ble for mem­ber­ship. You are el­i­gi­ble for mem­ber­ship in one or more credit unions based on where you or your fam­ily mem­bers live, work or wor­ship. This is re­ferred to as the ‘Com­mon Bond’.

Does age mat­ter when a per­son wants to join a credit union?

A per­son has to be 16 years of age to be­come a mem­ber. How­ever, per­sons un­der 16 years of age can still save with the credit union in spe­cially de­signed youth sav­ings prod­ucts.

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