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Credit Union Strategy in Brazil and Australia
Australian Mutuals Archives was privileged to be invited to an industry panel featuring Cresol Confederação from Brazil hosted by the BCCM (Business Council of Co-operatives and Mutuals) with COBA and the Australian Mutuals Foundation.
The BCCM invited Marcio André Falcão, Executive Director, Cresol Confederação, to present to an audience of interested parties last week. Cresol is given headline billing as Brazil’s largest credit union, but Marcio leads a confederation of 59 cooperatives and a million members.
Sean Lo Cascio, Senior Manager Corporate Affairs, COBA responded to Marcio’s presentation with insights into the Australian customer owned bank sector before Australian Mutual Bank CEO Mark Worthington outlined issues the Australian customer owned bank sector is facing – e.g. the high costs of regulation and technology.
Cresol is celebrating its 30th anniversary and it is an impressive organisation in a burgeoning Brazilian movement – over the past decade, credit union market share in Brazil has grown from 5.9% to 12.9%.
The confederation began as a credit union for Brazilian farmers, some of whom had no banking facilities at all. Today, the network services all walks of life. Here is a snapshot of the Cresol Confederation:
Cresol is a financial cooperative system consisting of 3 levels: Confederation, or third level cooperative; Central, or second level cooperative; and Singular, or first level cooperative.
With performance equivalent to traditional financial institutions, it offers adequate financial solutions to its members, such as checking accounts, investments, credit lines, financing, among others.
In addition, Cresol is a member of FGCoop, the Credit Cooperative Guarantee Fund, which provides its members with the same security offered by the other institutions of the National Financial System.
The event concluded with some advice from Mark Worthington for the younger Brazilian movement. According to Mark, Australian credit unions have suffered from losing their dedicated legislation and being regulated like any other ADI. Losing cooperative classification also meant losing the income tax exemption for cooperatives. The advice being to avoid losing cooperative legislation by embedding cooperative values in practice.
Learn more about the Brazilian credit union sector here.