World History of credit cooperative

         The idea of credit unions creation was still in the middle of the XIX century. Just then, as a result of acceleration of industrial development, the problem of funds from the growing urgency got up not only for entrepreneurs, but also to certain groups of individuals. Mostly it was the community, united with manufacturing, professional or social interests. Unable to take credit in banks, people began to help each other their own funds.

        First in this activity believe Friedrich Wilhelm Raiffeisen. He created the first institution in Germany in 1848 year, by its nature similar to the modern credit union. Hermann Schulze have established a credit cooperative in 1850 at Delichi, also Germany, almost simultaneously with Raiffeisen. These institutions began to emerge in the UK and Italy subsequently.

        Raiffeisen organized a new credit union, whose members were mostly farmers in 1864. The leading idea of which was this: each member helping itself, helps others. This principle became one of the major in credit unions activity in the world. Shortly after the birth of German, cooperative movement spreaded throughout Europe and later in North America.

        When U.S. economics grew rapidly (1920-s years), the cooperative movement became more popular. Ordinary Americans have had more money and could bought more expensive goods such as cars. But they could not take money in the banks because the banks and similar institutions were not interested in a relatively small consumer loans. Cooperations readily given such services . This way at least 19 new unions was registered in the state of Massachusetts in 1921. And at the begining of 1999, 10 000 of credit unions successfully worked in the U.S. Now more than 70 million Americans are participated in such unions. Real giants with hundreds of thousands of members and billions of dollars of assets are working along with thousands of small unions in the country.

        World Council of Credit Unions which represents credit movement out 84 countries, was founded in 1971. Credit cooperatives became most popular in Ireland, USA, Canada and Australia.

Credit unions in Ukraine

         First mention which indicates about credit union creation in Ukraine, was dated 1862 year. That time, local artisans in Odessa concluded charter of savings and loan's association. Unfortunately any other details was not retained in history about this association.

        One of the first Ukrainian credit cooperatives was created in the city of Gadyach at Poltava - Gadyachsk's association of savings and loan. 28 artisans and merchants joined to the Society immediately. The average loan that was issued under surety, was 27 rubles:  decent "small business" could be opened with this money that time!   The activity of this union was quite successful, it existed up to 1919 as long as the Bolshevik Mauser destroyed micro crediting of  hardworking Poltavaers ...

        New savings and loan association: Sokirinskogo at Poltava, Vremiyivske  at Ekaterinoslav, and Oboznivske Petrivs'ke in Kherson was created in 1871.

        Every year in Ukraine was created 200-300 credit cooperatives since 1905. 2181of credit cooperation and 911 of savings and loan associations, were working in 1914 year.  They had  1 million 754 thousand members. Credit cooperatives united in unions (associations) which could coordinate their activities to solve common problems, to provide financial support  to one to  another, to support the newly created credit cooperatives since the beginning of XX century .

        After the Soviet government was established,  all credit companies were liquidated. From 1920, they joined in the reorganized Consumer Cooperation, which is actually completely subordinated to the state.

        Following independence, Ukranian Diaspora representatives launched a campaign to revive credit. Special commission to implement this idea was created in 1991 at the Ukrainian World Council cooperative, and later established the National Organizing Committee of the revival of credit movement in Ukraine.

© Narodna Dovira, 2010
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