Business Week Recognizes Credit Unions Role in Remittances
Madison, WI—Credit unions were recognized in
Business Week Magazine this week for their role
as a remittance provider and their effectiveness
of reaching out to the unbanked population. The
article, Channeling the Remittance Flood, quoted
industry expert, Manuel Orozco, executive
director of the Remittances & Rural Development
project at the Inter-American Dialogue, a think
tank based in Washington, D.C.
Orozco noted, "Today, fewer than 10% of
remittance recipients have bank accounts, largely
because traditional banks haven't been interested
in small clients. That will change as more
remittances are channeled into credit unions and
"Credit unions were often started to serve
that lacked financial services, World Council's
International Remittance Network (IRnet) opens
another door for credit unions to do just that,
by providing affordable reliable remittances,"
noted Tiffany Kultgen, World Council, IRnet
Officer. "Credit unions have the opportunity to
reach out to the unbanked population and can help
both remittance receivers and senders become part
of a formal financial institution and receive
education on credit and savings products."
Kultgen cited a World Council remittance study
conducted in Guatemala that showed 74% of member
recipients have been members of their credit
union for less than three years (remittances
distribution began in 2001) and forty percent of
members named remittance services as the primary
reason for having joined the credit union.
She continued, "Remittances will continue to
a key role in credit union development. Our goal
is to develop remittance linked savings and
credit products in developing countries to
further build on the success we've already
In 2005 credit unions originating or receiving
remittances as part of World Council's IRnet
program sent over $381.6 million and since the
program's inception IRnet remitters have sent
World Council of Credit Unions is the global trade association and development agency for credit unions. World Council promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. World Council advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions' financial performance and increase their outreach.
World Council has implemented more than 290 technical assistance programs in 71 countries. Worldwide, 56,000 credit unions in 101 countries serve 200 million people. Learn more about World Council's impact around the world at www.woccu.org.