New supervision will not curtail credit unions

This month, the Government of Belize announced that supervision of the country’s credit unions would be moved from the Ministry of Agriculture and Cooperatives to the Ministry of Finance, specifically, the Central Bank. The shift has created some confusion as traditionally Belize’s membership owned credit unions have been regulated much less stringently than the nation’s commercial banks. While the change in ministries prompted some initial fear that the arrangement would change, those fears were allayed on Wednesday at a meeting between Prime Minister Said Musa and representatives of each of Belize’s thirteen credit unions. This morning, Natalie Goff of the Belize Credit Union League, told News 5 that members have nothing to worry about.

Natalie Goff, Belize Credit Union League

?We want to ensure the safety and soundness of the member investments. You could say that maybe because credit unions are becoming a little bit more complex in that we have had to respond to the members? demands for increasing services such as ATMs and things like that coming into credit unions. It has made the operation a little bit more complex and so we have had to move a little with this trend in order to increase the level of supervision that credit unions are getting. It does not mean that credit unions were not being supervised before. What it means is that we have to increase the level of supervision that the credit union was getting. And so effectively what has happened is that the registrar of credit union; the person responsible for the formation, management, supervision and regulation of credit unions is now the governor of the Central Bank. It does not mean that we are going under the banking act. We are going to continue operating under the credit union act of 2002.?

Janelle Chanona

?As you mentioned it?s been a popular criticism, if you will, that credit unions do function like banks, but they are not under the banking act. What is the league?s response to that??

Natalie Goff

?The league feels that the credit union is not a bank. The credit union is people helping people. The credit union are made out of members, who deposits their monies into their credit unions and these monies are loan out to other members at a rate of interest so that we can have income for operations. The profits from these operations go back to the people in line of dividends and maybe lower interest rates on loans and for the development of the credit union. It does not go outside to anybody. So it?s our own local people using their resources to help other people in the country. That is the whole philosophy of the cooperative movement. A credit union is a financial institution but is a cooperative financial institution.?

According to Goff, the league has appointed a task force that will work in conjunction with the government to finalize the necessary amendments to the act which would make the Governor of the Central Bank the Registrar for Belize’s Credit Unions. News 5 understands that the league will also be using this opportunity to put forward their recommendations for changes in other sections of the credit union act. There are thirteen credit unions in Belize, with a membership of more than ninety thousand people, who have amassed more than two hundred and fifty million dollars in assets.