WOCCU Engages Regulators in South America

Madison, WI - In recent weeks, at the request of central bank and credit union regulators in Brazil, Uruguay and Paraguay, WOCCU provided these countries with expertise on appropriate regulations for credit unions.

At the Central Bank of Brazil's first international microfinance conference, WOCCU shed light on how to develop an enabling legislative environment for credit unions, the best practices for capital distribution, and auditing standards in credit unions. Although in absolute terms Brazil has the largest credit union sector in Latin America, it remains one of the smaller movements in the region when evaluated as a percentage of the population; weaknesses in capital also persist in several of Brazil's credit unions.

At a meeting with the president of the Central Bank of Uruguay, Walter Cancela, and the superintendent of Banks in Uruguay, Fernando Barran, WOCCU discussed the Central Bank's recently introduced restrictions on credit union operations. As a result of concerns raised by WOCCU, the Central Bank of Uraguay has delayed the implementation of the restrictions and has committed to reviewing and changing regulations upon the presentation of evidence that otherwise healthy credit unions are being restricted.

In Paraguay, a newly created regulator for the financial and non-financial cooperative sector is ramping up its activities. At the request of the World Bank, the credit union sector and INCOOP, the newly formed regulator for cooperatives, WOCCU has been reviewing the new prudential regulations for cooperatives in Paraguay. To follow up on suggestions made this past February, WOCCU met with the board and senior staff of INCOOP to discuss WOCCU's concerns. Although some progress has been made, WOCCU continues to be concerned with the new regulations.

"Representing our members and engaging policy makers with credible information on international best practices is at the core of what WOCCU is about," indicated Dave Grace, senior manager of Association Services. "The central banks of Brazil, Uruguay and Paraguay understand the potential that credit unions hold for improving the accessibility and quality of financial systems in their countries and hope to be able to realize this potential," concluded Grace.

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, 51,000 credit unions in 100 countries serve 196 million people. Learn more about World Council's impact around the world at www.woccu.org.