Soon after completing an Islamic finance program in Afghanistan, the World Council of Credit Unions has begun exploring opportunities to develop credit unions in a new country: Libya.
The World Council said President/CEO Brian Branch, along with Steven Stapp, president/CEO for the $822.5 million San Francisco Federal Credit Union, and Lara Thomas and Allaeddin Ghadyi of the human rights organization The MILLA Project, traveled to Libya in December.
There they discussed credit union development with representatives from the Central Bank of Libya, the Libyan Business Council, a business group in Misrata, Libya, and the civic and human rights group Libyan Liberal Forum for Democracy.
Libya offers limited access to financial services as a result of 2011’s civil war, its subsequent halt on oil production and exportation and decline in foreign investment and aid, and the recent attacks in Benghazi, the World Council said.
“The first priority for the government of Libya is writing a new constitution and establishing security,” Branch said. “Moving from a centrally controlled economy requires business security and contract protection. Local business councils in Tripoli and Misrata are looking for solutions to finance large-scale businesses.”
During their initial visit with Libyan group representatives, World Council representatives discussed how the products and services available through credit unions could be implemented in the country.
“We were approached to explain the credit union model,” said Stapp. “As the country reconstructs, it is an opportunity for credit unions to participate in rebuilding the economy.”
Branch added that Libya’s state officials and business councils are looking into releasing central bank guarantees and financing for business.
“Most small and family businesses are self- or family-financed, and that will be the next wave,” he said. “Consumer finance is still a new concept. Financial cooperation is still not well understood, but many are looking for an Islamic finance model. The credit union model fits.”
The World Council said it has now implemented credit union development programs in 71 countries, including 18 in Africa.