The history of credit unions

Credit unions have always been part of a large international movement. There are 40,258 credit unions in 79 countries around the world, enabling 118 million members to access affordable financial services.

Credit unions operating in Britain today are extremely varied in size, membership and the range of services they offer, but they all share a basic philosophy and set of principles with the worldwide credit union movement.

ABCUL is a member of the World Council of Credit Unions, which represents the credit union movement globally. Through membership of WOCCU, ABCUL and ABCUL members benefit from best practice information from around the world and tools such as the PEARLS Financial Monitoring System.

The ideas and values central to how credit unions work were developed in the 19th century. In Britain they were the work of pioneers such as Robert Owen. In Germany there were innovators like Herman Schulze-Delitzsch and in North America Alphonse Desjardin was mapping his vision of co-operative credit.

The credit union movement grew quickly throughout America and Canada and soon began to have an influence on the rest of the world.

Credit unions in Jamaica began during the 1940s. Father John P Sullivan, a Jesuit priest, believed credit unions could help working people cope better with wartime conditions.

In Ireland the first credit union was founded in 1958, thanks to schoolteacher Nora Herlihy and colleagues in the Dublin Central Co-operative Society, which she helped to found. The first Irish credit union developed through contact with the Credit Union National Association (CUNA) in America.

Credit unions took some time to take off in England, Scotland and Wales. People who had seen the idea work in Ireland, the Caribbean, Canada and the US were amongst the first British credit union pioneers.

Before 1979, there was no legal structure for credit unions in the UK. Some of the early credit unions chose to register under the Companies Act and some under the Industrial and Provident Societies Act.

Many of the credit union pioneers played a key role in getting a legal structure for credit unions on the statute book. Eventually, in April 1979, the Credit Unions Act was the last Act to be passed by the outgoing Labour Government.

In Ireland, over 70% of the population belong to a credit union. In America and Canada the figure is around 43%. Credit unions are also growing fast in Eastern Europe, parts of South America, Africa and the Far East.

For more facts and statistics about credit unions worldwide go to www.woccu.org