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Principle Six: Bringing financial access to rural poor in Mexico and worldwide

Posted By Jeff Hardin, Thursday, July 03, 2014
Updated: Thursday, July 03, 2014
Principle Six: Cooperation among cooperatives. Credit unions work together to improve services to members and build sustainable communities.

(Editor's note: in 2012, Ashley Ruffin of Local Government FCU and Jeff Hardin of the CCUL traveled to Mexico with a World Council representative. As part of their trip, they visited a Semilla Cooperativa in the state of Veracruz. You can read their story by clicking here, and view pictures from the Semilla Cooperativa by clicking here.) 

Written by Matt Garcia, project director, World Council of Credit Unions.  

Matt Garcia serves as the Project Director for World Council's USDA project in Ethiopia and the Cooperative Development Project funded by USAID in Mexico, Guatemala, and Kenya. Garcia has worked with World Council for the past seven years in a project management role.
Imagine living in a world where you have no access to a loan or a secure place to keep your savings. The nearest financial institution is 10 to 25 miles away, and the banks will not help because you do not have any credit history or enough assets to be considered worth the expense of rural finance.

Beginning in 2004, World Council sought to address this very issue in rural Mexico. Through funding from the Mexican government and national development banks, World Council initiated a technical assistance program to help credit unions improve performance and empower rural communities.

The cost of building a credit union branch office is a very expensive endeavor, especially for sparse rural populations in marginalized areas of the country. World Council created a model that allows credit unions to expand financial services to these areas through more affordable investments in personnel and technology.

This Semilla Cooperativa [cooperative seed] outreach methodology literally transports the knowledge and access of financial services into rural areas previously inaccessible due to high costs, high risks and minimal return. The model has gone through a rapid evolution over the course of three rounds of projects in Mexico.

The first phase of development was relatively rudimentary. Credit union field officers traveled by motorcycle to remote communities to provide financial education to small groups, disburse small loans, collect payments and savings deposits and provide handwritten receipts. The second phase transferred the methodology to the 21st century. World Council created a value chain of technological devices to further minimize costs—ATMs were implemented in population dense areas, point of sale (POS) devices were placed in local village stores to increase access and reduce risk of theft for credit union representatives, and credit union field officers used personal digital assistants (PDAs) in the most rural areas of the country. The current third phase incorporates mobile banking in addition to the other technological advances.


The development of Semilla Cooperativa has literally transformed the lives of Mexico’s rural poor by providing 24-hour financial access to a population that previously had none at all. Over the course of the three projects, World Council has brought over 1,375,237 members to the country’s credit union system.

In exchange, Mexican credit unions have shared their technical knowledge with the U.S. through World Council’s International Partnerships Program. The most recent partnership established was between Federación Alianza and Mountain West Credit Union Association in 2012.

At a Semilla Cooperativa session in rural Mexico, credit union field officers collect savings from members using PDAs and provide receipts with mobile printers. Watch a video on World Council rural finance initiatives like Semilla Cooperativa here.

Tags:  Credit Unions  Principle Six  World Council 

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