The Ukrainian parliament has passed a law that updates the country’s legal framework governing the operations of credit unions, a move welcomed by the World Council of Credit Unions (Woccu).
The law allows credit unions to provide more services to their members, including currency exchange and certain types of payment services. It also expands access to finance through credit unions for certain legal entities, such as farms, co-ops, trade unions, micro enterprises, housing co-operatives and religious organisations.
According to Woccu, the law also strengthens licensing, corporate governance and capital requirements in credit unions, expands the ways credit unions raise capital, establishes stabilisation and liquidity support funds for credit unions at the level of united credit unions, the central financing facilities and improves procedures for credit union mergers, acquisitions and other voluntary reorganisation.
“We could not be happier for the credit unions World Council represents in Ukraine,” said Andrew Price, Woccu’s general counsel and senior vice president of international advocacy. “The new law will strengthen the reliability of the sector and consumer confidence in it by expanding the availability of financial services credit unions can provide to the general public. Its adoption also paves the way for the introduction of deposit insurance for the credit union sector.”
Woccu International Advocacy and the Usaid/Woccu Credit for Agriculture Producers (CAP) Project in Ukraine have been campaigning for an update of credit union law since 2016, working with National Bank of Ukraine, which regulates credit unions, and the country’s two credit union associations.
In addition to lobbying for a new credit union law, Woccu and the CAP Project have been providing technical assistance to amend the country’s law on deposit guarantee funds. The update would enable credit unions to join the system, which provides a safeguard against loss for consumer accounts at banks in the country.