Dennise Williams, Staff Reporter
WHYTE
IN AN era of fierce competition for the hearts and minds of credit union members, the C&WJ Employees Credit Union (CWJECU) focuses not on flashy ads or hype but on one simple concept.
"Our focus must be to return to customer value. We encourage our members to use this credit union in ways that are profitable," says Barrington Whyte, general manager of CWJECU.
And that customer could potentially be you, as membership is open to anyone who works or worked for a company that subscribes to telephone services.
For 10 years, he has quietly guided the credit union and now seeks to grow the membership base from its current base of 10,000 shareholders.
And it is not just an empty mantra. The CWJECU has embarked on a three-pronged strategy to give its members greater value.
A key strategy was that the credit union was the first to pay interest on shares. Mr. Whyte explains, "We said to our members that once our credit union was in a good place in terms of capital adequacy, we would concentrate on bringing down interest rates while keeping returns on savings at near inflation rates."
Last year, the credit union achieved a capital to asset ratio of 10 per cent, which Mr. Whyte said was comparable to the two biggest commercial banks.
The result was an unusual achievement. "We are the first and only credit union to pay a monthly interest of six per cent per annum on shares regardless of the balance in the account. And as we distribute our surplus, we added an additional three per cent to our members bringing the total payment to nine per cent for 2004."
It is important to note that the credit union movement differentiates itself from other institutions in that it is a not for profit entity. All surpluses are used to build the entity or are paid out to shareholders.
Mr. Whyte adds, "This year, we continue to pay six per cent per annum on shares."
On the lending side, Mr. Whyte explained how his credit union adds value. "In our motor vehicle campaign we say that you deposit 10 per cent of the value of the vehicle you want to borrow and we will lend at 18 per cent. This is one of the lowest interest rates in the market. But we also will pay you interest on your deposit. And this brings down the actual cost of lending."
In order to do this, the second prong of the CWJECU strategy is cost containment.
"In order to pay interest to our shareholder members we must pay attention to cost management. For example, we had to devise a strategy to manage the cost of providing debit cards to our members. We charge a flat fee of $100 per month which gives unlimited access to ATMs plus we give unlimited standing order payments."
The third element in its strategy is to serve that segment of society whose banking needs are unmet. And the credit union is addressing this from several angles.
First, the head office on Half-Way Tree Road will be undergoing a major renovation. "We are refurbishing to first world standards. Other financial institutions are pushing people out of the branch, but we want to create a relaxing experience so that members will feel comfortable while conducting business."
Second, the credit union has purchased a building on East Parade, which is its 5th branch. Mr. Whyte believes that with the new housing schemes developed in Downtown Kingston, this group of citizens will need personalised service.
And finally, the credit union is focusing on clients who want to bank in-house. "How many Jamaicans are comfortable with debit cards? And how many Jamaicans have computers at home much less Internet service?" Therefore, Mr. Whyte sees an opportunity for his credit union to meet their financial needs.
After more than 25 years in the financial sector with companies such as the National Housing Trust, National Development Foundation and Eagle Merchant Bank, he now has the job of riding the wealth creation wave which has taken hold in the sector.
"Good money management is wealth creation," he says. "The job of the financial institution is to encourage people to behave a certain way over a long period of time. And while we don't make a lot of noise, it has always been our mandate to encourage the habit of thrift. That is what the credit union movement in Jamaica has been doing for the last 60 years."
