HISTORY OF CREDIT UNIONS
A Long Time Ago…
In search of financial freedom, people came together and changed the way we bank. They pooled their savings and offered loans at reasonable rates to people in their communities.
Credit unions were started by people who wanted to help other people achieve a better standard of living, prosper in business, and get their crops in the field.
The First Cooperative
In Rochdale, England, 1844, a group of workers came together to address the terrible conditions they were subjected to, and to take control of their lives.
They were tired of paying high prices for low quality food and wanted a store of their own that could serve them better. Individually none of them had enough money to pull it off, so they (and other members of the community) pooled their funds together. They opened a store and began to supply great food at reasonable prices to the community.
Values at the heart of this cooperative inspired the 7 International Cooperative Principles – guidelines followed by co-ops all around the world today.
Cooperatives
Catch On
From England, the cooperative idea spread throughout Europe. Friedrich Wilhelm Raiffeisen, the mayor of Flammersfeld, Germany, was concerned about the near-starvation conditions endured by local farmers and townspeople. Members of his community were losing their homes and livestock to money lenders who were charging them outrageous interest rates. To help them out, he founded the first cooperative lending bank – essentially the first credit union – in 1864.
Credit Unions in Canada
Alphonse Desjardins (born 1854) was a man from Quebec who wanted to help out people in his community who were in financial trouble. Overhearing the story of a man forced to pay $5,000 in interest on a $150 loan he'd taken out to save his family from starvation, he decided to take action.
He successfully launched the first cooperative bank (or caisse populaire) in North America in 1900. By the time of his death 20 years later, he'd been personally responsible for the establishment of over 200 caisses throughout Québec, Ontario, and the United States, and was considered a world-leading authority on cooperative financial institutions.
Credit Unions in Manitoba
The first credit union in Manitoba was organized in 1937 by a priest, Father Arthur Benoit, in the French farming community of St. Malo. Like most farmers at the time of the Great Depression, they were suffering. Father Benoit brought them together to help each other financially. The first loan financed the purchase of a cream separator.
People began founding credit unions in ever-increasing numbers across the province, and by 1939 there were 19 credit unions in Manitoba, with $49,990 and 2,406 members.
Credit Unions Now
Today, credit unions remain a secure alternative to the big banks. They continue to offer top quality products, competitive rates, and superior service, and the 7 International Cooperative Principles are still at the heart of everything credit unions do.
If you'd prefer to put your money to work in your community helping others, and share in all the benefits of belonging to a cooperative, discover a different way to bank at your local credit union.