Credit Unions Step Into Financial Breach

Community credit unions are stepping into the breach as banks continue to close branches in rural areas and turn low-income customers away, a spokesperson for the credit union movement says.

Speaking on the eve of International Credit Union Day (October 19), the chief executive of the New Zealand Association of Credit Unions, Doug McLaren, said credit unions offered increasing numbers of people their only option for financial services.

“The movement is a growing force in New Zealand, with close to 200,000 members which represents a 30 percent increase in ten years. One of the reasons we're growing is that traditional banks are quietly withdrawing from significant sectors of the market," he said.

"Many of our members, including a substantial number of beneficiaries, have been turned away by banks because they have the wrong socio-economic profile, or else live in the wrong place and their local bank branch has simply closed its doors."

Because they had a different philosophy, he said, credit unions on the other hand were happy to provide a service to these people.

"Credit unions work on a completely different set of principles to banks. In New Zealand, as throughout the world, the credit union movement is member owned, and working in a co-operative, not for profit, spirit.

"So, while banks see the poor as problem customers, we see them as people who need a hand to help them get on their feet.

"The motivation for credit unions in New Zealand is the same as elsewhere - by working together, the members are able to achieve a better life for themselves and for their communities."

Worldwide, credit unions operate in 85 countries with over 100 million members.

ends

For more information contact:

Doug McLaren
Chief Executive
New Zealand Association of Credit Unions
tel 09 309 9551
fax 09 309 9571

© Scoop Media