What do you know about Credit Cooperatives in Brazil? Want to know what credit unions are? What are the types and examples of Credit Cooperatives in Brazil? How is the concept of credit unions? This type of financial institution has not yet caught on in our country, unfortunately they are used efficiently in borrowing money and some basic banking services happens in countries of North America and especially in Europe. Credit unions are nothing more than the association of people with the common goal of helping each other, cooperatives are not-for-profit and not subject to bankruptcy and are generally run by people qualified by members to manage better the financial resources of the members.
In Cooperativa de Crédito , unlike financial institutions that aim for profits, the cooperatives aim to provide credit assistance (credit, personal loans and financing) and the provision of banking services in more accessible conditions for their members, including lending money with much lower interest rates and with fewer requirements than conventional banks and financial institutions.
In Brazil, Brazil is currently ranked 16th in the volume of assets managed by credit unions. There are more than 1,500 Credit Cooperatives throughout Brazil, together they manage assets of about US $ 17 billion, coming from its nearly 5 million members.
In Brazil, credit unions are treated as financial institutions (Law No. 4,595) and their operation must be authorized and regulated by the Central Bank of Brazil. Cooperativism also has its own legislation, Law 5.764 / 71 and the Law.
The credit cooperatives are not so significant in the financial market, their performance reaches 3% of the total credit movement in the country. In credit cooperativism some systems are more advanced and representative in Brazil SICREDI – Sicredi Participações SA, SICOOB – System of Credit Cooperatives of Brazil, UNICRED – Unicred do Brasil, ANCOSOL – National Association of Credit Cooperatives of Family and Solidarity Economy and followed by Independent Cooperatives not attached to a Confederation.
The “Credit Cooperatives” are divided into three categories:
Unique Cooperatives –
This type of Credit Cooperative provides financial services in fundraising and offers of credit only to the respective associates, can receive onlendings from other financial institutions and make investments in the financial market.
Central Cooperatives –
In this type of cooperative, the service is related to the unique affiliates, and are also ancillary responsible for its supervision.
Confederations of Central Cooperatives – This type of cooperative provides services to Central and its affiliates.
The Credit Union is organized in the form of a cooperative society, it is maintained by the cooperative or associates themselves, who simultaneously play the role of owners and users of the system. Credit unions are a surprising tool for strengthening the national economy, democratizing people credit and deconcentrating income.
Credit Cooperatives are excellent for obtaining a huge range of financial products and services at low cost, some are very complete and do not want to want those who are accustomed to banking. We will be posting much more information on Cooperatives here at Dolly Varden, stay tuned!