The Jamaican credit union landscape
CREDIT UNIONS are notfor-profits that function to provide a secure, convenient place for members to save money and get loans and other financial services at competitive rates. These institutions are located in communities, professional groups, employee-based organisations, and associations. Historically, the credit union concept has been around since the 1800s but did not arrive in Jamaica until the 1940s. The notion of this cooperative financial institution was not to be in operation for the controlling interests of a few shareholders, but to supply financial services to enhance the quality of life through economic independence for all its members.
In 1821, Robert Owen, known as the Father of Cooperatives, coined the motto ‘Each for All and All for One’. Co-operatives are owned and run by its members, permitting each member to have equal say in what the business does and also to share in profits. This is why credit unions are described as such and are based under the auspices of the co-operative values which are: self-help, self responsibility, democracy, equality equity and solidarity.
THE CREDIT UNION MOVEMENT COMES TO JAMAICA
It all began in 1939 when a Catholic priest from Boston, Massachusetts, in the United States – Father John Peter Sullivan – arrived in Jamaica to teach religious instruction to students at St George’s College. Through this employ, Father Sullivan came in contact with Jamaica’s struggling working class at the time and developed a greater understanding of the social and economic challenges facing Jamaica. On average, weekly wages were just US$10 per week, which was unable to meet economic needs. Facilities for loans were used to exploit the poor, charging as much as 200 per cent per annum on each loan by loan sharks, and the average man making small savings was denied the opportunity of a loan from commercial banks.
Father Sullivan later became a director of an organised group known as the Catholic Young Men’s Sodality (CYMS) that would meet weekly to perform parochial work. By 1938, there were mass riots in Jamaica against poor wages and inhumane working conditions.
This encouraged Father Sullivan and the CYMS to form a credit union in a bid to address the many economic issues. On September 12, 1941, with pooled resources, they began operations with shares amounting to US$1.87, which was Jamaica’s first credit union: the Sodality Credit Union. Sodality offered loans at 12 per cent interest per annum and dividends at six per cent.
The credit union movements grew leaps and bounds through the participation of fishermen, store clerks, factory workers, civil servants, ancillary workers, rum workers, policemen, bar maids, and more. Other groups began forming credit unions across Jamaica. By 1947, membership stood at 265 with accumulated savings of US$12,444 and a loan portfolio of US$27,750 and as they say the rest is history.
THE CREDIT UNION MODEL
The credit union model and the cooperative principles continue to provide a viable option for financial services, coupled with guidelines for membership education and duality of purpose.
Our guiding principles are:
The credit union movements grew leaps and bounds through the participation of fishermen, store clerks, factory workers, civil servants, ancillary workers, rum workers, policemen, bar maids and more.
Voluntary and open membership Democratic member control Member economic participation Autonomy and independence Education, training and information Cooperation among cooperatives Concern for community
THE JAMAICA CO-OPERATIVE CREDIT UNION LEAGUE (JCCUL)
Founded in 1942 by Father Sullivan and financed by its member credit unions, the JCCUL is a cooperative central body that regulates and oversees all credit unions island-wide. The League includes a 15-member board of directors and a chief executive officer who manages the daily operations and a five member supervisory committee. The Supervisory Committee ensures that the JCCUL is compliant with all policies, regulations, and the effectiveness of controls throughout the organisation.
The objectives of the League include: Representing its members regarding Government legislation Organising central business services Receiving deposits from credit unions and co-operative societies Giving loans to the credit union members Undertaking investments Organising new credit unions With assets of $4 billion at the end of December 2015, the JCCUL also has oversight responsibilities for the JCCUL Group, which includes four subsidiary organisations all geared at providing a number of products and services. Preliminarily, as at January 31, 2017, it was reported by the JCCUL that all credit unions – which numbers approximately 29 across Jamaica – amounted to the following: Savings: $73.83 billion Loans: $63.74 billion Assets: $95.67 billion Membership: 1,028,182
CONCLUSION
Today, the credit union movement in Jamaica is celebrating 75 years and within this time zone, the NCB Employees Co-operative Credit Union celebrates 25 years of outstanding service to our members and has contributed significantly to the Jamaica Co-operative Credit Union. Globally there are over 60,000 credit unions serving over 223 million members. Here in Jamaica in 2017, there are 29 credit unions serving over one million members.
As we celebrate the anniversary milestones and anticipate the Bank of Jamaica Regulations and the Credit Union Act and as we continue collaboratively to embrace the governance, guidance and support of the Jamaica Cooperative Credit Union League and the Department of Co-operatives and Friendly Societies, we must not lose sight of the important contribution of credit unions in our national development.
We must continue to recognise the work and worth of credit unions for our members and the movement. With the ideology of duality and self-help, credit unions should continue to be flexible and agile in providing the goods and services within the dynamic and competitive business environment.
Become a credit union member today and shape the history being created for our member owners and the community! BRENDA CUTHBERT Board Chairman
Today, the credit union movement in Jamaica is celebrating 75 years and within this time zone the NCB Employees Co-operative Credit Union celebrates 25 years of outstanding service to our members and has contributed significantly to the Jamaica Co-operative Credit Union.