Celebrating Credit Unions Worldwide
When you think of credit unions, what’s the first thing that pops into your mind?
Maybe it’s the great deal you got on your auto loan or the great rate you earn with your savings. Maybe you think of your credit union’s strong ties with its community.
All these things are hallmarks of the credit union experience. But your local credit union is also part of something much bigger. It’s a worldwide movement.
You might be familiar with some of the things that make credit unions unique. They’re democratically controlled, not-for-profit financial cooperatives that are owned by their members. Instead of being driven by profits, credit unions are built on the philosophy of “people helping people” and focused on supporting their members’ financial well-being.
It’s an idea that goes way back. In feudal Japan, lending cooperatives helped members pool money to access interest-free short-term loans. By the late 1800s, the earliest examples of modern-day credit unions were springing up across Europe. In both cities and rural communities, these cooperatives helped everyday people participate in a banking system for the first time.
Celebrating International Credit Union Day
Credit unions are continuing to make their mark around the world. Each October, thousands of credit unions take part in International Credit Union Day (ICU Day, for short) with festivities to raise awareness about the important work that credit unions do and recognize the achievements of the movement’s pioneers and today’s members.
Now in its 74th year, ICU Day’s 2022 theme is: “Empower Your Financial Future with a Credit Union.”
Empowerment has been a cornerstone of the movement since Day One. Credit unions help people, especially those who are underserved by traditional banks, by providing greater access to services that help them build financial security and achieve important milestones like owning a home, starting a business, and sending their kids to college.
Today, promoting financial inclusion is more crucial than ever. Worldwide, more than 1 billion adults are unbanked, according to the World Bank, and women are especially affected. Here in the U.S., many households remain unbanked or underbanked too.
This means people in those households don’t have access to basic services like a checking account. Instead, they may turn to costly alternatives to a traditional banking relationship – like payday loans and check-cashing services. This can prevent people from building wealth and keep them trapped in a cycle of debt.
By offering greater access to reliable, affordable banking services, credit unions play a key role in helping people join the financial mainstream and achieve more with their money.
Seven Inspiring Stats
Around the world, credit unions go by different names. They may be known as financial cooperatives or, in Africa, savings and credit co-operative societies (SACCOs). But they’re united by a shared mission to help their members and communities.
After many decades, the movement is going strong. Just look at these numbers:
- More than 375 million people bank with credit unions, according to the World Council of Credit Unions (WOCCU).
- The WOCCU, one of the organizations behind ICU Day, represents more than 86,000 credit unions operating in 118 countries.
- Almost 90% of all credit unions are in Africa and Asia, according to Statista.
- In India, an estimated 91 million people rely on credit unions, according to WOCCU.
- The largest credit union in Latin America, Caja Popular Mexicana, serves more than 3 million members.
- Here in the U.S., 3x more credit unions are minority depository institutions (MDIs) than banks, according to the National Association of Federally-Insured Credit Unions. MDIs are financial institutions that are at least 51% minority owned.
- 10x more female CEOs than banks, reports the NAFCU.
Building Financial Know-How
In recent years, developing nations have made great strides in increasing access to financial services through new technology. But achieving financial well-being takes more than banking products. People need a solid grasp of key concepts like account management, budgeting, saving, and credit use.
Here, there’s still a lot of work to be done. In one international survey, just 17% of people ranked their financial knowledge as “high.” Lack of financial experience can make people more vulnerable to costly banking choices, fraud, and unmanageable debt.
Credit unions have been leading the charge to boost financial literacy through in-person education and online resources. As credit union pioneer Edward Filene once put it, “A credit union is an educational institution.”
Here at American Heritage, we’re doing our part by offering access to a wealth of educational resources for all ages. Explore all our learning opportunities, which include timely seminars, access to free financial counseling, programs for students, and our online financial wellness platform, the Learning Center.
Spread the Word
The more people who participate in credit unions, the stronger our movement gets. So, tell your friends about the benefits of credit unions and invite them to join. They’ll be glad they did.