February 13, 2007: Credit Union with an Exciting Future

St. Theresa’s credit union in Begoro has had its challenges and faces many more to come, but they are prepared. Everyone on the board and the mandatory committees is new – they have only been on the job (volunteer) for 2 months. The previous board had lavish spending practices on office and administration expenses and let the loan delinquency get away from them.

With the urging of CUA and the auditors, the members elected a new slate of directors in December. In only two months, the new board has developed a sound business plan with 7 goals in 4 key performance areas. This business plan would hold up to many business plans at Canadian credit unions!

The core membership of the credit union is teachers (the board are all teachers). For this group of members, delinquency and building savings is a non issue as the savings contributions and loan payments are deducted from their paycheques.

However, the membership was opened up a while back and the credit union now has a delinquency of 36% with inadequate loss provisions and insufficient retained earnings to support a delinquency level of 36%. The credit union has sound plans in place to reduce this number to 15% by June 2008.

Some initiatives include informing the delinquent members that their savings will be seized if payments are not restarted. Another tactic includes posting the names of the delinquent members on the wall of the credit union office for all to see. Ghanaians are very proud people and will rush in to have their names removed from the list.

St. Theresa’s credit union impressed Barry and me. They have a new board with lots of energy, commitment and focus. They understand that it will take some time to make the corrections and we told them we were confident they would be successful.

February 14: Happy Valentines Day

Today we popped in to say hello to two of the credit unions I met with last year. One of them is in a new building (Abosomankotere). Look at the first blog entry for a photo of the old building and see the new one on Flickr.

Prosper Aforbu is the manager and he is full of energy and vision. It was his work that enabled the credit union to see into the future and move out of the workplace (they still operate a satellite branch in the hospital) to a street front location. Financially they have had a very good year and have all the controls in place.

He was very excited to see me return and Marcia Greenwood (my partner from last year) arrived later in the day. We went off to his inlaws to see his wife, Elvira and their 6 week old daughter. They are a very happy family.

On Thursday the 15th, we returned to review the credit union’s activities for the previous year. We also visited with Ebenezer Credit Union- one of the highly successful ones in Ghana. They are one of 7 on the country to have a business plan (the second one this week that I have visited).

They had a very successful year income and assets grew – assets by 24%.

We are now in Takoradi which was a grueling 9 hour drive in the hot African sun in a vehicle with manual air conditioning. Whew! The rest of the coaches will gather here and we will exchange notes and prepare a brief report for the CUA meeting early next week.

Tomorrow, Barry and I are off to meet our first Tribal Chief at Aba Hagan’s home village whcih does not have electricity. We will have lunch and then return to Takodori. Aba and her family will join us on Sunday at the hotel. A relaxing weekend…