CREDIT UNIONS
BY
ADANSI BAPTIST CHURCHES
A STUDY BY
PS. MICHAEL SAKYI (FIRST BAPTIST CHURCH, OBUASI)
BRO. JULES K. ABROKWAH (SHALOM BAPTIST TEMPLE, OBUASI)
INTRODUCTION 1
1. NATURE 3
2. FORMATION ... 4
3. BENEFITS .5
RECOMMENDATIONS.8
CONCLUSION ..8
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Introduction
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WHAT IS A CREDIT UNION?
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were best kept separate in the interests of sound cooperative
management. In 1852 Schulze-Delitzsch consolidated the learning
from two pilot projects, one in Ellenburg and the other in Delitzsch
into what are generally recognized as the first credit unions in the
world.
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which affiliates to the African Confederation of Co-operative Savings
and Credit Association(ACCOSCA) and the World Council of Credit
Unions(WOCCU).
1. NATURE.
The Credit Union is such that people with a common interest come
together in a society, mobilize funds regularly so that after six
months, when a needy member applies for a credit facility he/she
would be offered with a minimum interest rate payable within a
period of time. At a close of a financial year, management declares
profit and shared among members contributions. The concept is
good and appreciated and need to be promoted in workplaces,
churches and communities.
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The funds accumulated in the credit union through the systematic
savings of its members are the source of credit that members use.
2. FORMATION:
To begin a business such as a credit union, you first of all need a
place of operation and materials that are relevant for the day to day
administration of the business which includes stationery, furniture,
and other fixed assets. In Ghana, every Credit Union is required to
have at least 150 members to begin operations and every member
is required to pay an entrance fee of not less than ghc5. It was also
identified that it is required by all credit unions to register under the
Cooperative Credit Union Association (CUA) which is a regulatory
body for all credit unions in the country. This however can be
achieved by having accumulated an amount of GHC 15,000.00 of
savings.
Individual Unions are also required to purchase GHc 500.00 worth of
shares in the association. Below is an expatiated criterion for the
formation of a credit union in Ghana.
1. The Credit Union shall be required to have a minimum
membership of 150 with a potential membership of not less than
600.
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5. Societies will be required to have permanent offices to operate
from, with the Credit Unions signboard and business hours properly
written and conspicuously placed.
11. All societies seeking affiliation shall pay an affiliation fee of fifty
Ghana Cedis (GH 50.00) as determined from time to time by CUA.
13. Societies seeking affiliation to CUA must have saved at least five
per cent (5%) of their total funds in CUAs CFF (Central Finance
Facility) and shall continue to save not less five per cent (5%) of
their total funds at any point in time.
14. Societies seeking affiliation to CUA must satisfy CUA that they
are part of the Risk Management Program or arrangements have
been made to become a member of the Program.
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15. Affiliated societies shall contribute an agreed percentage of the
total savings of members as at June every year, into the CUA
Stabilization Fund.
3. BENEFITS
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- Friendliness and Accessibility: Big banks can seem cold, formal and
even unreachable It often seems that branch managers don't have
the authority to make the decisions to help you, or that the bank
itself is so huge it doesn't really care about having your business.
Credit unions can be friendlier in atmosphere and tone and simply
more accessible on every level. According to Jenn Cloud (A digital
marketing manager for RedKey Realty Leaders in St. Louis, USA) , "being smaller
and local allows them to be very connected to their neighborhoods
and versatile to respond to feedback."
With the credit unions, giving loans are its lifeline and keep the
business running therefore failure to grow the loans book may also
contribute to its failure.
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Failure to get genuine volunteers: since the credit union is largely
owned by the members, most may wish to volunteer to serve in the
business. However if the right people are not recruited or appointed
to serve the business is likely to fail. Right people here mean people
with knowledge in financial operations.
RECOMMENDATIONS
During this study, we sought for random views from the general
public who have an experience in the operation of credit unions and
here are some their suggestions;
CONCLUSION:
In this study it was realized that credit unions can operate manually
at its beginning stages with just an office, a manager and clerk or
secretary. The set up Board for this credit union should consists of at
most one pastor from the Baptist Church. Proper documentation is
also advised in order to have a smooth running of the credit union.
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