Fiji Teachers Union Cooperative warns that some cooperatives are acting like banks as Credit Union Bill 2025 is reviewed
The Fiji Teachers Union Cooperative Thrift and Credit Limited says a worrying trend is taking hold: some cooperatives are functioning primarily as financial institutions, issuing loans and prioritizing money-lending over the broader cooperative principles of member welfare and community development. The concern was raised in a submission to the Standing Committee on Economic Affairs during the review of Credit Union Bill 29 of 2025.
Chandar Dutt, Chief Executive of the union, argued that many cooperatives now resemble commercial banks in their structure and operations. He stressed that while offering loans is a key function of credit unions, the cooperative movement encompasses far more than money—mutual support, shared responsibility, and financial empowerment for members remain foundational.
“See, in cooperatives, the scope is very broad. You have land cooperatives, farming cooperatives, and small business shops in villages. But for us, we are solely financial; we only deal with money and issuing loans,” Dutt said, underscoring the risk of losing the movement’s broader identity if regulations don’t keep pace with practice.
Dutt also called for legislation that is flexible, inclusive, and future-ready, noting that clear regulations are essential to prevent the movement from drifting away from its core purpose. He added that the union stands ready to contribute to the development of the new framework.
The Credit Union Bill 2025, which is being discussed in Parliament, seeks to modernize Fiji’s credit union regime by expanding the Reserve Bank of Fiji’s role as registrar and regulator. Proponents say modern governance, enhanced risk management, and stronger consumer protections are needed to restore public trust as the sector has faced a sharp decline in the number of active unions in recent years. Critics warn that governance reforms must avoid stifling the cooperative spirit and impose costs or burdens that could hinder member service.
Supporters of broader reform point to provisions for governance clarity, committee responsibilities, education, capacity building, and digital transformation as essential to helping unions operate effectively in a changing financial landscape.
What this means for stakeholders
– Governance clarity: Clear roles for subcommittees and boards could reduce ambiguity and improve accountability.
– Regulatory balance: Expanded oversight by the Reserve Bank of Fiji aims to strengthen stability and protections for savers, while regulators must avoid overreach that stifles member services.
– Member focus: Provisions for education, capacity building, and digital tools are expected to enhance service delivery and financial inclusion.
– Sector resilience: A modern framework could help rejuvenate Fiji’s credit union sector and restore public confidence.
Positive outlook
With thoughtful design and broad consultation, the Credit Union Bill 2025 has potential to create a more resilient, transparent, and inclusive credit union sector that preserves the cooperative ethos while enabling innovative services for communities.
Summary
The Fiji Teachers Union Cooperative urges caution about turning cooperatives into narrowly focused financial institutions and calls for a flexible, future-ready legal framework to safeguard the movement’s broader mission as Fiji considers modernizing its credit union laws. The reform aims to strengthen governance, align with oversight by the Reserve Bank of Fiji, and support member welfare and financial inclusion.
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