In the next of our reflections from the Fair4All Finance Conference Matt Bland, Chief Executive at ABCUL, shares his thoughts on the ‘Transforming credit unions and doubling mutuals’ panel discussion.
It’s approaching a month since the Financial Inclusion Together conference brought together professionals from across the diverse and vibrant array of organisations and sectors that face the challenge of delivering a real step change in financial inclusion. The energy and enthusiasm for making real progress on one of society’s most stubborn and pernicious drivers of inequality and disadvantage was palpable.
As someone who has worked in the credit union field for 16 years, it was a heartening experience to share the day with so many friends and colleagues committed to seizing the once-in-a-generation opportunity of the Government’s Financial Inclusion Strategy, which was published by HM Treasury the following day.
Credit unions have been at the forefront of efforts to address financial inclusion since the Financial Inclusion Taskforce of the Blair and Brown Governments in the early to late 2000s.
Despite our model’s great potential as community based deposit taking lenders, who can provide a range of financial services like affordable credit, responsible savings, banking and payment services, and insurance, we have yet to deliver the scale of impact that we could. And we also need to incorporate the impressive international examples of how credit unions can play a major role in financial services from the US, Australia, and Republic of Ireland.
But with Fair4All Finance committing a £30 million investment in credit union transformation in the Financial Inclusion Strategy, and a Government in parallel committed to doubling the size of the co-operative and mutual sector – of which credit unions are a small but critical part – there is a real opportunity to realise our potential and be a leading force in delivering financial inclusion.
Alongside the Fair4All Finance investment, we expect reforms to liberalise the common bond field of membership test which determines who can join a credit union. We hope to build on this with reforms to credit union regulation flowing from the Mutuals Landscape Report which will shortly be published jointly by FCA and PRA as commissioned under the ‘doubling’ agenda.
It was timely therefore to have the opportunity to chair a panel discussion at the conference. We explored themes which are emerging both in conversations with Fair4All Finance on how to deploy its investment and the Credit Union Sector Growth Plan which ABCUL has been developing with our membership and the wider credit union sector, under the auspices of the Mutuals & Co-ops Sector Business Council, to discover how we might double the size and reach of our sector.
We heard from Ciara Davies, Chief Executive of Metro Moneywise Credit Union in Rochdale – birthplace of the co-operative movement – and Executive Lead for the Sound Pound Group, a consortium of credit unions organised as a secondary co-op or Credit Union Service Organisation (CUSO) which is actively demonstrating the potential for collaborations of credit unions to deliver economies of scale. It is also responding to the devolution agenda with several active initiatives in collaboration with Andy Burnham and the Greater Manchester Combined Authority, notably a scheme to help residents access annual travel passes, paid monthly, with an interest-free credit union loan.
Laura Wallis, Director of UK Deposit Takers at the Prudential Regulation Authority, Bank of England, updated us on progress around the Mutuals Landscape Report and, in particular, proposals to create a regime to support credit union investments in CUSOs.
Noel Cunningham, a consultant with years of experience in the Irish credit union sector, provided insights around how the Irish sector has delivered an impressive transformation through raising standards of professionalism, a concerted programme of strategic consolidation and mergers, as well as creating a flourishing community of CUSOs delivering a whole range of operational efficiencies and product innovations from payments and current accounts to mortgage lending.
And finally, Jonathan Turner, technology lead at Fair4All Finance, reminded us of the importance of a clear and coherent digital transformation strategy, focused on change management, data integrity and the human dimension of digital delivery as a key determinant of credit unions’ success in modernising services and remaining relevant.
As we look towards implementation of our growth plans and delivery of the Fair4All Finance investment, these pillars of collaboration, consolidation and technology will be critical to our success, underpinned by flexible and enabling regulation. I am excited to work across the sector to deliver once and for all on our proven potential.
