The Reserve Bank of Fiji (RBF) has made a compelling case for the Standing Committee on Economic Affairs to endorse the Credit Union Bill 2025, highlighting the urgent need for reform in Fiji’s troubled credit union sector. The RBF’s submission, made during the Committee’s closed discussions in August, pointed out that the industry is grappling with an outdated legal framework that is hindering its development and threatens its viability.
“With the credit union industry making only slow progress, primarily due to a legal framework that hasn’t evolved in alignment with global trends, reform is critical to ensure its future,” the RBF stated. Alarmingly, of the 400 registered credit unions, only 17 are operational. A similar trend is evident in financial cooperatives, with just 5 of the 29 registered thrift and credit cooperatives remaining active.
The proposed Credit Union Bill 2025 aims to modernize the sector and enhance its significance within Fiji’s financial sector. By establishing clear licensing pathways, implementing stronger governance structures, and instituting robust oversight, the Bill is designed to create an environment conducive to the expansion and enhancement of credit unions.
Key provisions of the legislation include mechanisms for risk management, member protection, and sustainability, addressing historical gaps that have stifled growth within the sector. Additionally, the Bill promotes financial inclusion, empowering underserved communities with access to savings and credit, while fostering innovation through electronic banking and diversified financial products.
The RBF emphasized that the Credit Union Bill 2025 represents a pivotal advancement, laying the groundwork for a modernized, inclusive, and resilient credit union landscape, capable of making meaningful contributions to Fiji’s economic development. The Bill successfully passed in Parliament last week, marking a hopeful step forward for the industry’s future.
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