The co-operative movement had its foundation in the 19th century when people, usually small agriculturalists, began pooling their resources for their mutual benefit and to protect themselves against exploitation by larger, more powerful economic bodies. By the pooling of resources, specialization became possible, members could best use their talents and they had greater access to more professional services, which as individuals they could not afford the time or resources to employ.
The overriding philosophy under which co-operatives operate is the concept of human development and the brotherhood of man expressed through people working together to achieve a better life for themselves and the community. Central values are equality, equity and mutual self help and involve the following practical principles: -
- Open and voluntary membership to all persons within a common bond
- Democratic rights of one man, one vote regardless of the size of his financial power or shareholding.
- Non-discrimination in respect of race, religion, sex, nationality or politics.
- Objective of improving the economic and social welfare of all its members.
- Generation of profits for distribution to all members
- Financial strength within the field of operation of the co-operative
- Continuing education of all members and staff
- Co-operation with other co-operatives for the benefits of all members and the Credit Union Movement.
Credit Unions started as co-operatives to provide credit to people who would not otherwise be good credit risks to bankers or who could not afford bank's high interest rates and who in turn wanted a safe haven for their savings and were intimidated by the large, established, wealthy banks or whom banks were not interested in doing business with.
Credit Unions therefore operate in the finance industry competing for funds to lend to their own members when required at reasonable and controlled rates of interest to enable them to purchase items for productive and provident purposes, which they would not normally be able to acquire and for their mutual benefit in terms of social and economic development and welfare.