Companies & Committees

S E C T I O N F I V E

It’s my placeas well

54 A N N U A L R E P O RT 2009

IntroductionThe ILCU Foundation (ILCUF) was established by theIrish credit union movement in 1980. Irish creditunions felt a responsibility to share the success of theIrish movement with those in less developedcountries. They wanted to give something back byhelping people to help themselves, specificallythrough the credit union model.

Mission StatementThe mission of the ILCUF is to alleviate poverty indeveloping countries by supporting credit unions, theirrepresentative bodies and other co-operative-typeorganisations as a means for socio-economicdevelopment through the provision of financial andtechnical assistance.

The ILCUF is currently supporting long-termpartnerships in The Gambia, Ethiopia, Albania, Russiaand Ghana. In 2009, it decided to start working inSierra Leone, while also providing funding to anumber of small projects in the developing world.

Income and ExpenditureAnnual contributions from the Irish credit unionmovement in 2009 amounted to €828,000. Thiscontinuous support is greatly appreciated by theILCUF and its partners, especially in thesechallenging economic times. Approximately 300Irish credit unions affiliated to the ILCU currentlycontribute towards the work of the Foundation.

With this money in 2009, the Foundation hassupported:

● Over 700 credit unions and over 400,000 membersand their families through its long-termpartnerships

● Over 10,000 beneficiaries and their familiesthrough 13 small projects

International Credit Union DevelopmentThe following is the progress made with our majoroverseas partners in the past year:

GhanaGhana is located on the west coast of Africa. Povertyis prevalent there and it is particularly staggering inNorthern Ghana. The ILCUF began working in Ghana

in 2008 in partnership with the Canadian Co-operative Association (CCA) and the Credit UnionAssociation of Ghana (CUA) in an effort to reducepoverty in Ghana through credit unions. ILCUF andCCA are providing funding support to assist thecredit union movement in Ghana to become self-sustainable and have also committed to providetechnical assistance to credit unions there.

During 2009, there was a focus on the cross-cuttingissue of gender in the credit union movement.During the year, the project worked to prepare forthe Women`s Leadership Training Programme. Thetraining was geared towards women managers ofcredit unions, although there were some womenattending who are credit union staff. The maintraining objectives were to bring women managerstogether to build relationships between them andincrease confidence and capacity of leadership. Thefocus is less on ‘hard’ skills like managing loandelinquency and more on ‘soft’ skills like qualities ofa good leader and confidence building.

Part of the technical assistance that the ILCUFprovides to the project is the Ghana CoachingProgramme. The Foundation participated in this inearly 2009 as a pilot project and, as a result of thesubsequent evaluation being so positive, it wasdecided that this would be an extremely worthwhileform of technical assistance for the ILCUF to beinvolved in on an annual basis. During the coachingtrip in 2009, eighteen credit unions in Ghanareceived in-depth technical support from thevolunteer Canadian and Irish credit union managersinvolved. Therefore, another coaching trip will takeplace in early 2010. It allows Irish donor creditunions and their managers to become more involvedin the work of the ILCUF. This is something that theILCUF is keen to achieve, particularly in respect of theprovision of technical assistance, given the vastexperience of Irish credit unions.

International Development Foundation

No ofcredit unions

Members Savings € Loans €

450 350,000 94,000,000 71,000,000

A N N U A L R E P O RT 2009 55

AlbaniaAlbania is located in South-Eastern Europe andremains one of the poorest countries on thecontinent. The Foundation has been supporting thecredit union movement in Albania since 1995through its national apex body called Jehona. TheAlbanian credit union movement is making steadyprogress in achieving its aim of improving the leveland quality of services that credit unions provide totheir members.

Jehona managed to increase its self-sustainabilityfrom 48% in 2008 to 61% in 2009. This is aremarkable achievement given the current financialcrisis that is affecting ILCU’s partner countries and inparticular Albania. Savings have also grown inAlbanian credit unions during the year byapproximately 12% which is excellent in theserecessionary times.

Jehona installed a computer programme in 6 creditunions towards the end of 2008, which was funded

by both Jehona and ILCUF. This system is now in placeand working well and during 2009, the positiveeffects of this, such as increasing efficiency of thecredit unions, became clear. Hence it is offering abetter quality of services to members. Three days ofdetailed training on the computer package took placeduring 2009 for operators in the 6 credit unions.

EthiopiaEthiopia is located in Eastern Africa and is Africa’soldest independent country. It is an extremely poorcountry, which has a world development ranking of170th (out of 179th).

The ILCUF is working in partnership with Self HelpAfrica (SHA) since 2007 to support the credit union

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5Pictured are the coaches that participated in the Ghana coaching trip 2009.

No ofcredit unions

Members Savings € Loans €

26 9,351 2,800,000 2,800,000

movement in Ethiopia. SHA is an Irish charity thathas been working in Ethiopia since the severe faminein 1984. In Ethiopia, access to finance is a majorissue affecting the lives of millions in urban and ruralareas – where the majority are living under thepoverty line.

2009 marks the third year of this five-year projectand the Savings and Credit Co-operatives (SACCOs)have made good progress towards attaining keytargets with regard to the end of the 5 years. TheSACCO movement follows the same philosophy andapproach of the Irish credit union model. Theultimate objective of the project is the reduction ofrural poverty through increasing access to ruralfinance, by supporting 208 primary SACCOs whichare affiliated to 5 regional SACCO unions, with atarget number of 31,200 members. Currently thereare 186 existing SACCOs with 26,266 members.Membership figures grew significantly during 2009.At the end of 2008, there were 157 SACCOs with20,181 members. The size of the membership is acritical element affecting sustainability of theSACCOs. The SACCOs are attempting to educaterural communities on the operation and advantagesthat they offer, as they have little awareness of this.The growth in the number of SACCO membersmeans that access to finance has improved for alarge number of un-banked rural communities andis, in turn, helping to address rural poverty, as loansare often invested in small business and farming.Individual members have also seen their savings existand grow through the practice of adding a smallamount on a regular basis.

Despite the progress made, these SACCOs requirefinancial, technical and material support for someyears to come due to their stage of developmentuntil they attain operational and financial self-sustainability.

ILCUF undertook a detailed evaluation of theperformance of the project in late 2009. Thisassessment concluded that to date all funding hasbeen very well spent in developing grassroot SACCOswhere members, volunteer directors and staffbelieve in the credit union principles. In addition, theSACCOs are providing both savings and creditservices to members. It identifies the need to

continue to provide technical assistance, to increasenetworking among SACCOs, to seek to updatelegislation and to commence building a union-owned representative apex body.

Tafas’ StoryTafa’s Abdisa set up business in Buee town in theOromia region of Ethiopia. She buys and sells coffeepots and gifts in her stall, which she set up aftersecuring a loan through her village SACCO that shejoined five years ago.

Tafas’ husband is employed as a casual labourer, whofinds work during harvest time but is frequentlywithout a source of income. Therefore, the moneyshe raises from her stall is a much needed source ofincome. ‘We have a young family, and the moneythat I can make from this business is vital to us’, shesays.

56 A N N U A L R E P O RT 2009

Tafa

No ofcredit unions

Members Savings € Loans €

186 26,266 1,000,000 1,000,000

A N N U A L R E P O RT 2009 57

The Gambia

The Gambia is located in West Africa and it is thesmallest country on the African continentalmainland. The ILCUF is supporting credit unions inThe Gambia through the national apex body,National Association of Co-operative Credit Unionsof The Gambia (NACCUG).

During 2009, the Gambian movement experiencedimpressive growth. Total membership grew by 20%,with almost 6,000 new members joining during theyear. NACCUG managed to register three new viablecredit unions by running a successful radiopromotional campaign. Total savings also increasedduring the year by approximately 25%, from €4.8million in 2008 to €6 million at the end of 2009.

During 2009, NACCUG provided an impressive arrayof training courses covering various aspects of creditunion operations. The key topics covered weregovernance, strategic planning, internal controls andcredit management. During 2009, a total of 103Board of Directors, 54 Supervisory Committeemembers and 56 Loans Committee members weretrained. A five-day training course on bookkeepingand accountancy was also organised and it wasattended by 34 credit union officials.

Sierra LeoneSierra Leone is located in Western Africa and is anextremely poor nation with tremendous inequality inincome distribution. Currently, it is ranked 179th

(last) in the UN Human Development Index. While itprocesses substantial mineral, agricultural andfishery resources, its physical and socialinfrastructure is not well developed. The fate of theeconomy depends upon the maintenance ofdomestic peace and the continued receipt ofsubstantial aid from abroad. Democracy is slowlybeing re-established after the 1991-2002 civil warthat resulted in tens of thousands of deaths and thedisplacement of more than 2 million people.

Until the late 1980s, the credit union movement wasmaking good progress, but it was destroyed by thecivil war. What remains is a seriously under-resourced and ineffective movement, but withexternal assistance, there is enough to build on.Following an assessment visit at the start of 2009,the ILCUF in partnership with Canadian Co-operativeAssociation (CCA) is starting a new project tosupport credit union re-development.

As part of this two-year project, the ILCUF and CCAplan to build strong “model” credit unions in theFreetown area and then expand to the rural areas.This will help to develop a strong movement in thelong term. Currently, there are six existing creditunions in Freetown that retained some level ofactivity throughout the civil war; these will berehabilitated and strengthened as part of this projectby attempting to expand membership, modernisethe services, management and governancepractices.

In the initial two-year project, it is hoped to helpestablish 12 new credit unions and along with theexisting 6 credit unions, increase membership to4,000. As part of the project, it is planned that theGhanaian credit union movement will also assist inre-building the Sierra Leonean movement by mainlyproviding training.

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‘Roaming Bookkeepers collecting savings from members in avillage in the Gambia’.

No ofcredit unions

Members Savings € Loans €

66 36,061 6,000,000 4,400,000