There is an ongoing craze here where groups are organizing their own credit union. Leading this scheme are the groups of public utility drivers since they are already an organized group. They would require their members to contribute capital on a regular basis that they will loan out to members with interest. And the earnings are divided to the members. It is like earning profit from their own pocket which is really a good idea.
Well it sounds like a good idea to me. I mean if individuals can organize it on their own within the confines of the law why not? Credit unions by their nature are supposed to be member owned so it sounds like a good idea for people to organize and use their own money to finance these credit unions. They are quality events that can allow individuals to borrow money at lower interest rates than conventional banks.
Those informal credit union has also reached offices. As an example, we have one in our department (and some in other departments as well) and I am the organizer, hahahaaa. We start contributing in January, lend the money to our members to earn interest and in December, distribute everything - principal plus interest. My colleagues are just too happy with that credit union since they seem to be forced to save money. Maybe in a decade or so, the informal credit union will be everywhere here.
In principle it's a good idea and I am aware of a few that have started up recently. I think the main risk is that with it vmbring set up informally, there won't be any set rules and regulations in place and a lot will depend on the trust and values of the people involved.
You are right. It is setup informally although we have a policy that clearly states the rules particularly the mechanics of the lending and the sharing of dividends. But primarily the setup hinges on the trust of the members to the organizer. The risk of the treasurer to run away with the money is always present so they choose someone with a high position who would not risk his job for that kind of money. That scheme is working not only in our office but in other companies that I know.
