Microfinance as a   Vehicle to Create a Platform for Ownership of Financial Institutions by               the Poor      Co...
ACCU   Is a regional networking body of credit    unions or financial cooperatives in Asia   We represent 40.5 million i...
Member own savings based Credit Union Involvement in Poverty Alleviation 157 years ago in 1852 credit union was establishe...
   A credit union is a cooperative financial institution that is    owned and controlled by its members, and operated for...
Raiffeisen on Savings: 360 Degrees financial literacy education – help poor reach financial independence.“Many drops form ...
Credit Union Microfinance :1. Financial freedom for the   poor2. Enables people to grow3. Financial literacy for poor4. Po...
Key Results, Effects, Impact    6,899,405 New members    15354 credit unions    Savings of US$ 323.6 million    Loans ...
      Only 17.5% of CU members belong to the       poor, but total number is still significant as       the CUs are able ...
How the poor become the ownership of the CU gain from?1. Survey      2. Meeting            3.                             ...
The ownership context of Credit Unions             Owned, managed, controlled by members                                Re...
Organizational Structure with ownership representation                            General Body                            ...
Ownership - power Membership   Suspend Board & sub-committees   Appoint auditor   Decide maximum credit limit   Decide...
Board Accountability to Ownership ???   To ensure sound    management that is    compatible with the    socioeconomic int...
 Supervisory Committee-the security guard of                the credit union• Supervision - audit of accounts• Social aud...
Q&A                                                Thank you.                                                  www.       ...
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Ranjitch Hattiarachchi_Microfinance as a Vehicle to Create a Platform for Ownership of Financial Institutions by the Poor

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Ranjitch Hattiarachchi_Microfinance as a Vehicle to Create a Platform for Ownership of Financial Institutions by the Poor

  1. 1. Microfinance as a Vehicle to Create a Platform for Ownership of Financial Institutions by the Poor Cooperative/Credit Unions Prospect Ranjith Hettiarachchi Chief Executive OfficerASSOCIATION OF ASIAN ASIAN CONFEDERATION OF CREDIT ASSOCIATION OF CONFEDERATION OF CREDIT UNIONS UNIONS
  2. 2. ACCU Is a regional networking body of credit unions or financial cooperatives in Asia We represent 40.5 million individual members from 21,892 credit unions in 25 countries in Asia With 6.8. million poor ownership of CUs 17.5% owners are the poor ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 2 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  3. 3. Member own savings based Credit Union Involvement in Poverty Alleviation 157 years ago in 1852 credit union was established to fight poverty. “Credit Unions must not confine themselves to granting loans. Their main objective should be to control the use of money, to improve the moral and physical values of people, and their will to act byHermann Schulze-Delitzsch and themselves.” - Raiffeisen F. W. Raiffeisen in Germany ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 3 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  4. 4.  A credit union is a cooperative financial institution that is owned and controlled by its members, and operated for the purpose of helping its members achieve financial freedom. Credit Financial Union IndependenceAn all-inclusive organization. A Credit union is for everyoneregardless of religion, race, gender, and social status. ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 4 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  5. 5. Raiffeisen on Savings: 360 Degrees financial literacy education – help poor reach financial independence.“Many drops form first aCreek...Then a Stream.... andfinally, a River” ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 5 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  6. 6. Credit Union Microfinance :1. Financial freedom for the poor2. Enables people to grow3. Financial literacy for poor4. Poor people build their own financial institution5. Sustainable income source Accumulation of wealth through savings ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 6 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  7. 7. Key Results, Effects, Impact 6,899,405 New members 15354 credit unions Savings of US$ 323.6 million Loans granted of US$ 223.8 million Repayment rate – 95% average 11 countries – Nepal, Philippines, Sri Lanka, Thailand, Bangladesh Vietnam Cambodia Laos Mongolia, Indonesia and, MyanmarThe above is on top of the 2.01 million poorest among thepoor are reached by the Asian Credit Union system ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 7 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  8. 8.  Only 17.5% of CU members belong to the poor, but total number is still significant as the CUs are able to reach over 6.8 million poor client-members CUMI is now active in 11 countries in Asia but outreach and growth rate are still low. Till this year only2.04 million poorest among the poor ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 8 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  9. 9. How the poor become the ownership of the CU gain from?1. Survey 2. Meeting 3. 5. Learn & of the with Motivation 4. Group Save Sessions Area Village with target Formation (within 3 Head groups months) 10. 9. Weekly 8. Loan 7. Loan 6.Monitoring Group Utilization & Granting Inaugurati & Meeting monitoring on of theEvaluation Process Group 10. 1 10.2 9.1 sharing 9.2 Record Incentives, sessions keeping rewarding for Savings & good loan repayment performance collection Empowerment=Graduation as Member of CU(ownership)mainstreaming have less ( E and L Poor) in the society. 9 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  10. 10. The ownership context of Credit Unions Owned, managed, controlled by members Receiving Financial 100% Governance by services plus members Decision making Membership at the AGM Share Selection of the Credit Selection of Board of Union Supervisory Directors Committees MembersASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 10 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  11. 11. Organizational Structure with ownership representation General Body (Members) Board of Supervisory Directors Committee Credit Education Committee Committee Other Other Committee Committee Professional Management Staff ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 11 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  12. 12. Ownership - power Membership Suspend Board & sub-committees Appoint auditor Decide maximum credit limit Decide on borrowed capital Approve investment policies Bylaws and its amendments Business plan Strategic plan Approve the audit report ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 12 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  13. 13. Board Accountability to Ownership ??? To ensure sound management that is compatible with the socioeconomic interest of present & potential members.ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 13 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  14. 14.  Supervisory Committee-the security guard of the credit union• Supervision - audit of accounts• Social audit-monitor plans & its implementation, behavior of Board & staff, compliance with policies• Reporting of findings to Board and general assembly• Suspension in the event of misconduct and violation of policies/code of ethics ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 14 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS
  15. 15. Q&A Thank you. www. www.aaccu.asiaASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS 15 ASSOCIATION OF ASIAN CONFEDERATION OF CREDIT UNIONS

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