Co-op Money NZ Welcomes Passing of the Bill

Third Reading of the Friendly Societies and Credit Unions Bill Heralds A New Era of Growth

AUCKLAND, 4 July 2018: Co-op Money NZ, the industry association for credit unions, says the unanimous passing in Parliament of the third reading of the Friendly Societies and Credit Unions Bill (‘the Bill’) is a significant milestone and endorsement for the future of the New Zealand credit union sector.

Co-op Money NZ Interim Chief Executive Officer Jonathan Lee says that the Bill will herald in a new era of growth and innovation for credit union sector which has over $1 billion of assets and operates through 70 branches from Whangarei to Invercargill.

Credit unions will no longer need trustees to hold assets or operate their businesses which Lee says is an inefficient bureaucratic requirement. “The Bill does away with the need for credit unions to have trustees which will reduce a layer of complexity and cost and make it much simpler to do business for the benefit of our members.”

“This Bill modernises the out of date legislation credit unions have had to operate under and means we can continue to provide the 190,000 credit union members with access to the latest core banking services but under a much more efficient structure by becoming bodies corporate with full capacity and powers of a natural person.”

Among other things, this Bill also means credit unions will be able to more easily expand their services to include lending to small and medium sized enterprises (SME) in the next 12 months.

Lee notes that lending to SMEs will be very important in New Zealand’s small, regional towns where many credit unions operate as pivotal parts of their communities. “Undoubtedly it will give the regions a much needed boost.”

The Bill also removes ambiguity, and allows Co-op Money NZ to deliver even more competitive, innovative banking and payment services at reduced cost to its Member credit unions and other financial institutions in New Zealand,” says Lee.

Lee says that the New Zealand credit union sector would like to thank Stuart Smith, the MP for Kaikōura, for introducing the Bill and endorses his support and words in Parliament.

“Parliament is handing a vote of confidence to our credit unions to give them the best chance of success. This Bill has been a collaborative effort right across the industry, and also across Parliament. I am proud to see the passing of this legislation which will see credit unions come into line with modern practises adopted by other financial institutions, with no lessening of their mutuality and the common bond of their members,” Mr Smith says.

The Bill will now proceed to receive the Royal assent from the Governor-General before becoming law.

ENDS

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