Local Credit Union Movement Reports Increase in Membership and Predicts More Mergers in 2024

The head of the local credit union movement is reporting an increase in membership this year and says more mergers are likely in 2024.

In his New Year’s message, President of the Barbados Co-operative and Credit Union League Ltd (BCCULL) Kemar Cumberbatch said that

“We are not disconcerted by the fact that the number of credit unions on the island has contracted by one, at the end of 2023 to stand at 26. It is important to note that while this has occurred, there continues to be a steady rise in the number of persons attaining credit union membership,” he said, noting that in 2023, some 7 000 more Barbadians joined credit unions, bringing the number of credit union members to 238 042.

Cumberbatch added: “There is evidence of an emerging trend that the leadership of some smaller credit unions are making the wise, strategic decision to voluntarily merge their operations to form larger and institutionally stronger units.

“We at the Barbados Co-operative & Credit Union League Ltd. endorse such initiatives that position credit unions to enhance the services to their members and strengthen the institutions to respond to the dynamic and evolving regulatory and compliance landscape in which we operate.”

Noting the growing credit union membership and expressing the belief that there is a credit union member in nearly every household in Barbados, Cumberbatch said it is incumbent that the savings of such an overwhelmingly wide segment of the population be protected through deposit insurance coverage against any major institutional incident.

The credit union movement boasts member deposits of around $3 billion.

Government announced in 2022 that it would make deposit insurance coverage for credit unions a reality, through the Barbados Deposit Insurance Corporation (BDIC), after more than a decade of lobbying by the BCCULL. And the league’s president expects major steps forward in this effort next year.

“With the establishment of the Cross Regulatory Working Group comprising representatives from the BCCULL, the Financial Services Commission, the Central Bank of Barbados, the Office of the Chief Parliamentary Counsel, and the BDIC, we expect to report significant progress on this matter early in 2024,” he said.

Currently, only the six commercial banks on the island, along with four non-bank deposit-taking financial institutions are fund members of the BDIC which provides protection for customers’ savings in the event of an institutional failure. The savings of each depositor is covered up to a maximum of $25 000.

Meanwhile, Cumberbatch commended credit unions for the significant attention they have given to digital solutions in the delivery of services and the high priority assigned to cyber security and data protection.

“Our affiliates are dedicating enormous resources and attention to this area to safeguard the integrity of our systems against bad actors who are targeting a range of commercial enterprises and individuals in the Caribbean,” he said.