The first credit unions started migrating to the new IT system in December during a visit by Dave Grace, WOCCU vice president of association services, and Kris Kim, vice president and controller for Motorola Employees Credit Union in Schaumberg, Ill.
Centralizing the IT systems is just the latest step in South Korean credit unions' efforts to collaborate. South Korean credit unions also have a unified marketing program that positions the credit unions under one common brand.
"Credit unions have grown on the basis of co-existence, faith, honesty and trust for nearly half a century," said Oh-man Kwon, president and chairman of the National Credit Union Federation of Korea, the credit union trade association in South Korea and central liquidity facility that houses the IT system. "We have made ceaseless efforts to improve the social and economic status of common people of Korea's middle class since the movement began in 1960."
The credit union movement in South Korea celebrates its 50th anniversary in 2010 and has grown to serve 13.5% of the country's population according to WOCCU's 2007 Statistical Report. South Korea ranks third in size of membership after the United States and Canada.
"Credit unions in many countries are looking for ways to centralize operations and gain national brand recognition common within the banking industry without sacrificing local ownership and the member service touch," Grace said. "South Korea has done that and is serving its members with great success."
Kim said that the growth credit unions have seen in South Korea is partially due to the fact that Koreans are very family-oriented. Kim said once a father joins a credit union the whole clan will follow suit, and once they're members, it's not likely that they will change financial institutions.
"Each individual credit union operates almost like a service center that's part of the larger credit union system," Kim said. "The movement has gained tremendous operational and strategic efficiency through continued collaboration. U.S. credit unions may be too individualistic to ever cooperate at such a high level, but I think there are components we could adopt from the Korean model."