The Role of Credit

Unions in Post Disaster

Reconstruction

Presented by Sarah Shima, Program Manager

Sustainable Disaster Relief Housing Conference

Thursday, October 27, 2011

Presentation Overview • Introduction to CCA and our international development

work

• What are co-operatives?

• Sri Lankan credit unions after the tsunami

• Housing reconstruction issues

• How working with credit unions solved these issues

• The importance of working with an objective third party to provide oversight

• Questions

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The Canadian Co-operative Association

• Provides leadership to promote, develop, and unite co-operatives and credit unions for the benefit of people in Canada and around the world.

• Over 100 years old

• Represents more than nine million co-ops and credit union members from over 2000 organizations, including finance, insurance, agri-food and supply, wholesale and retail, housing, health and the service sector.

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CCA’s International Development Experience

• Over 60 years experience

• Expertise in finance, agriculture, and small and medium enterprises

• Overarching themes of gender equality, climate change, and youth

• Over 50 countries in Asia, Americas, Eastern Europe, and Africa

• Funding from CIDA, World Bank, the Canadian Red Cross, and various Development Banks

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What is a co-operative / credit union?

Seven International Co-operative Principles

1. Voluntary and open membership

2. Democratic member control

3. Member economic participation

4. Autonomy and independence

5. Education, training, and information

6. Co-operation among co-operatives

7. Concern for community

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December 2004 Tsunami in Sri Lanka

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• National death toll – over 30,000

• Over one million homeless

• USD 1.5 billion infrastructure repairs

SANASA Credit Union Movement • Over 100 years old

• 8500 credit unions

• 850,000 members across Sri Lanka

• Camps provided organization, needs identification, and gave information to victims

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CCA – SANASA Project

Integrated project:

• Housing

• Micro-loans

• Livelihood training

• Risk management and insurance

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Housing Reconstruction Issues

Conflict and Corruption

1. Difficult to target vulnerable populations

2. Inflated costs of materials

3. Poor quality construction

4. Bribes

5. Community conflict

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Housing Reconstruction Issues Conflict and Corruption – Credit Union Solutions

Locally owned and governed, therefore:

1. Chose who received housing

2. Members involved in building

3. Construction completed by local people

4. Members had ownership of process

5. Chose to work with tsunami affected districts, not just households.

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Housing Reconstruction Issues, con’t Design Flaws

• Location

• Architecture

• Water and sanitation

• Ownership

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Housing Reconstruction Issues, con’t

Design Flaws – Credit Union Solutions

• Members / owners involved in planning and building

• Two modular house designs

• Included water and sanitation in design

• Chose families with land titles and advocated for joint entitlement where only male heads of households were registered.

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Why did Credit Unions Work?

Locally owned, democratic institutions:

• Know their members;

• Are transparent and trusted;

• Maintain considerable networks in their communities;

• Have experience coordinating and organizing; and,

• Are fiscally responsible.

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Other Benefits

• Builds local capacity

• Ensures respect of local customs and culture

• Decreases donor dependency

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But…Oversight is Still Required

• Objective 3rd party

• Unfair local customs

• Transparency

• Quality assurance

• Realistic timelines and expectations

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Thank you!

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