Page 12 - Book4E

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The lending cooperative idea gained momentum in Canada in 1900 when Alphonse Desjardins established a credit union in Quebec. The initial savings deposit required was 10 cents, and the total of the first collection of monies from all members was $26. Through Desjardins’ perseverance for most of his life, the credit union concept took hold in all of North America.
Two Americans—Pierre Jay, a banking commissioner in Massachusetts, and Edward Filene, a merchant in Boston—became interested in the unorthodox lending ideas they were hearing about from groups of employees who were starting savings and loan cooperatives. Filene was a forward-thinking employer who had already instigated profit sharing and other benefits for his employees that were revolutionary for the time. While traveling in India in 1907, Filene visited a country village in which the people had established and were successfully operating a village credit union. He was intrigued by the concept.
As a banking commissioner, Jay recognized the value of the credit union organizations and wanted to recommend some improvements. He wrote to Desjardins in Canada, and in 1908, Jay, Desjardins, Edward Filene, and a few other like-minded people met to discuss this new financial venture. The result was the first credit union in the United States in New Hampshire in 1909. Legislation advocated by these men followed and created the first credit union act in the U.S.
The advent of World War II virtually halted the growth of credit unions, but growth quickly resumed once the war ended. Between 1945 and 1955, the number of credit unions in the U.S. doubled. Although the number of actual credit unions began to decline after 1969 due to smaller credit unions merging with larger ones, the number of credit union members continues to grow.
Credit unions have spread across the world and have become an important part of the world’s financial foundation. In 1970, the World Council of Credit Unions was formed and included groups from Canada, Africa, Asia, Australia, Latin America, and the Caribbean.
HIstory of Credit Unions