WASHINGTON, D.C. — Credit unions' cooperative structure provides them with unique opportunities to connect agricultural processes with economic growth, thereby addressing two key issues in global development. Greater efforts should be made to foster credit union growth to better address this need, said panelists during a session at the Overseas Cooperative Development Council (OCDC) conference here last week.
The one-day event, "Cooperatives: Meeting Development Challenges of the 21st Century," attracted attendees from Bosnia, Mozambique, Rwanda and Sri Lanka, as well as the United States. World Council of Credit Unions (WOCCU) representative Suresh Wijesinghe, deputy director of WOCCU's program in Sri Lanka, stressed the value and positive economic impact of the agricultural lending program in the lives of members of Sri Lanka's Women's Co-operative Development Society, known as Women's Coop.
"Women's Coop members are improving their lives through the credit union's services, from group lending to insurance to health and education services," Wijesinghe said. "The agricultural lending program is being rolled out on a pilot basis in four of the branches, with the plan to expand to all 121 branches so that all members can benefit."
According to Wijesinghe, Women's Coop members have improved agricultural production technology and found new market linkages through value chains, a process that provides funding through credit union-based loans to various participants in the process of taking crops from field to market. Results of the Sri Lanka program show an average 23% increase in return, 14% reduction in production costs and 17% increase in yield. For more information on WOCCU's Sri Lanka program, please go to www.woccu.org/microfinance/programs/country?c=LK.
With 30% of the world served by credit unions, there is growing recognition that credit unions can assist individuals in the agricultural sector in working their way out of poverty, according to Dame Pauline Green, president of the International Co-operative Alliance and fellow presenter at the event. "Credit unions aid the process by providing market access to sell their goods, helping them collectively negotiate better terms, keeping ownership local and meeting members' needs," Green said. "These are all traditional values of the cooperative model."
Dr. John Mellor, former director general of the International Food Policy Research Institute and chief economist at the U.S. Agency of International Development, offered insights on the essential role cooperatives play in the new global and foreign aid context. There's a critical need for apex bodies in the credit union and cooperative movements "to organize people to raise members' income," Mellor said.
Tim Rieser, foreign policy expert for Sen. Patrick Leahy (D-Vermont), described how U.S. government-funded programs can improve the lives of people in developing countries. Cooperatives are an important mechanism for achieving this goal, he explained.
"[Cooperatives] know what they need to do and it's our job to help them," Rieser told participants. "Cooperatives not only promote economic development on a small scale, but also enhance democratic development because they involve making joint decisions. These programs achieve results at the community level."
OCDC brings together organizations that promote, assist and support the formation of member-owned cooperatives throughout the world. OCDC member organizations work together on a variety of promotional efforts and also engage in collaborative research activities to improve cooperative development practices.
WOCCU, a member of OCDC, helped coordinate the May 20 conference, which focused on shared examples of ways that credit unions and cooperatives improve members' lives. To see photos, presentations and video from the conference, please go to www.cooperativechallenges21.org.
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, 57,000 credit unions in 103 countries serve 208 million people. Learn more about World Council's impact around the world at www.woccu.org.