Credit Unions Serving Youth & Communities
Name of the Cooperative: CDCU Youth Credit Union Programs
Date of Incorporation: 1990-present, various
Membership: 4000+
Activity: Provides financial services to youth in underserved communities
Organizational form: Varies-function as youth-run entities within credit unions (consumer financial cooperatives)
Area Served: Financially underserved regions across the United States
In the United States, one of the richest countries in the world, more than one in 10 Americans live in poverty (US Current Population Survey, 2007.) Often, impoverished communities lack access to banks and credit unions that most of the population takes for granted: Access to fairly priced deposit and loan services. From the beginning, credit unions were started to serve populations without access to these resources. The mission to serve these communities through access to community-owned financial resources continues with community development credit unions (CDCUs) today. The National Federation of Community Development Credit Unions (Federation) provides support and advocacy for credit unions doing important and necessary work in these impoverished communities. One essential task is serving youth in these communities.
If the communities served by these credit unions are to prosper in the future, community youth must receive both the education and the resources that they need to survive in today's economy. CDCUs are uniquely positioned to serve this growing need. As cooperative organizations, not only can they offer youth an opportunity to learn about finances and to save money, but credit unions offer youth the opportunity to learn about and invest in their communities, while taking part in the uniquely cooperative decision making process. To this end, in the 1990's CDCUs across the United States, with support from the Federation, started youth credit union programs, or YCUPs.
Cooperatives would succeed, where schools, banks, and community groups did not provide the necessary financial resources to adults. Each CDCU chose a model that fit their own community- models that have been changing and evolving ever since. YCUPs function as segments of the incorporated CDCUs that they are affiliated with. In most cases the youth have some control over their own portion of the organization, often with their own board of directors, tellers, and managers. Some have school branches and savings clubs, while others operate directly out of the credit union. While the YCUPs differ in structure, they share a set of general principles: youth leadership and decision-making, skills development through hands-on experience and training, youth savings, community and school partnerships and youth entrepreneurship.
Local Programs / Local Communities
One example of an YCUP that exemplifies these principles is the Mission Area FCU's San Francisco YCUP. Started and designed by youth in 1996 and still led by youth, the program currently has 500 members and $75,000 in assets, larger than some independent credit unions. The programs are funded by public and private grants, youth organized fundraisers, and in-kind support from Mission Area FCU. Two paid adult program staff, a Director and Coordinator, organize the youth program. Youth volunteers and paid interns, manage and staff the program, and provide both coordination and oversight. The program offers special individual development accounts and regular savings accounts to youth in the Mission, an economically underserved portion of San Francisco. While there are other banks and credit unions in the Mission, many of the low-income, mostly Hispanic residents don't feel comfortable with these other financial institutions.
The YCUP also provides other services. It helps youth find employment in other credit unions after they have learned about cooperative principles and the specific skills necessary for these jobs. It also provides financial literacy education to community members. Recently, the YCUP began a new program called Youth Trainers for Economic Power, a youth-to-youth training and advocacy program. The program will train a team of 10 youth to deliver education to youth on basic money management, college preparation, and financial services, and will give them a chance to participate in campaigns to improve the financial services in their neighborhoods. The activities of the YCUP and its programs are clear examples of the cooperative principles: members themselves gain from the programs, while focusing on the community at large.
A Nationwide Network
The Federation works to support all of the credit union youth programs. They sponsor an annual meeting for youth to network, learn, and build the connections to support each others' programs. In 2007, the conference was held in New Orleans, alongside the Federation's own annual conference. One of the most powerful moments of the conference was the opportunity to help rebuild an education center destroyed by Hurricane Katrina. In addition to powerful volunteer activities, the conference also offers workshops and the opportunity to meet community development and credit union leaders from around the country.
The network also provides a space for youth to share their experiences and to encourage others to support youth credit unions. With the help of youth and adults from around the country who work with youth credit unions, the Federation is able to provide resources to others who would like to pursue similar concepts.
The cooperative model allows youth to build experience for themselves while working to benefit society. Working with CDCUs allows the youth are able to concentrate on essential programs, without having to deal with the specific problems associated with running an independent credit union. Even so, the youth gain knowledge about the specifics of a cooperative financial institution. YCUPs also provide significant short- and long-term benefits to their affiliate credit unions, their communities and to the cooperative movement.
Youth are new members that often remain committed to their credit union, they provide a link to other members who might not know about the credit union, and after arriving through youth programs might even draw in their parents. Additionally youth provide a new employee and volunteer base for the cooperative movement. YCUPs are transforming their communities by building a cooperative base for the future. Going forward, the Federation, in conjunction with individual YCUP programs, hopes to spread the YCUP the model to successfully serve other credit unions around the country and the world.
