The Credit Union Movement’s Approach to Fostering Social and Economic Resilience for the ‘New Normal’

The Credit Union Movement’s Approach to Fostering Social and Economic Resilience for the ‘New Normal’
In times of any disaster, be it natural or otherwise, a need will always arise to strengthen social and economic resilience. If we are to be less vulnerable than we were for the Covid-19 pandemic, there will undoubtedly be a need to identify and address those sectors of our society which have suffered more than others.
To the extent that our own members have suffered more than others, the credit union movement of Trinidad and Tobago must now take up its mantle and play its part in empowering and protecting those who have become or perhaps become more socially and economically vulnerable as a result of Covid-19.
The severity of the effects on society brought on by Covid-19 is not as straight forward as the consequence of exposure to the virus, as it is also shaped by social, economic and political factors that foster vulnerability in all these respective areas.
The Most Vulnerable
It has been found that the most vulnerable in the current circumstances have been the poor and socially marginalized. This is so for the following reasons:
  • They typically face greater exposure to the virus by living in marginal or unsafe areas such as densely populated communities, where social distancing is more challenging and where running water may be a luxury.
  • They are more likely to live in substandard housing with lower hygiene levels
  • They tend to possess uncertain land ownership rights or high value assets and hence no incentives for further investments that may have helped to protect them, like pipe borne water and in-house toilet facilities.
A Cycle of Poverty and Vulnerability
Even after a pandemic subsides a cycle of poverty and vulnerability is likely to continue as poor and marginalized communities can suffer the consequences of uneven relief and recovery efforts. Such communities may also face obstacles to accessing entitlements such as government relief or recovery assistance.
History has shown that many post-disaster relief and recovery initiatives do not ensure that particular vulnerable groups are appropriately identified and reached, despite considerable evidence of the harmful effects of failing to do so.
Historical trends have also shown that entitlement programs have traditionally favoured tenants of record; bank account holders, and perceived heads of households.
The Credit Union Movement must use this Knowledge to Guide Initiatives as we move Forward
In light of these factors, it is critical that our movement notes that vulnerability to a pandemic of such a magnitude as Covid-19, is heavily influenced by social, institutional, and political factors that govern entitlements. This will be the foundation for putting mechanisms in place to quell and alleviate a disastrous social and economic vulnerable situation.
Guiding these initiatives will also be the acknowledgement that even among disenfranchised groups, subsets will be particularly vulnerable during and beyond the ‘new normal’. These would include:
  • Children
  • The disabled
  • Older people
  • Landless tenants
  • Migrant workers
  • Women
Acknowledgment must also be given to the fact that the root causes of this vulnerability lies in a combination of:
  • Geographical context
  • Financial/Socioeconomic circumstances
  • Cultural background
  • Even gender
  • Lack of or restricted access to public services like health care & education
  • Information for optimal decision making
Members of these groups are often employed in the informal sector, where the loss of housing means the loss of workplace, tools, supplies, and markets. Let us quickly look at the 2010 earthquake experienced by Haiti. At that time in Haiti, the informal sector accounted for 85% of the overall economy.
This sector bore much of the responsibility of caring for children, the elderly, and the disabled. They were also responsible for the majority of household tasks, which in this case, included the provision of water.
A disaster or pandemic of any form will no doubt increase the intensity of this work, and informal networks among neighbours and extended family (a critical coping mechanism in times of crisis) would begin to drastically dissolve.
First Stop… Start from Within
The recovery of individuals and businesses (especially SMEs) depends on the survival of institutions such as Credit Unions. As a movement we need to build survival strategies to recover and transform during the pandemic and beyond.
Just as any other establishment, Credit Unions will have suffered varying degrees of disruption during this period. This is when critical knowledge and financial expertise for adaptive leadership and business continuity becomes absolutely necessary and as a movement we have started the ball rolling!
The Central Finance Facility (CFF) has been facilitating credit union thought and action in this regard. Under the heading “Project 2020”, three Committees we formed. The Transformation Committee has been mandated to develop Cooperative Strategies that would lead to a more just and equitable society; while the Food Security Committee is employing the Cooperative Business Model to enhance our country’s capacity to produce its own food; and finally the Technology Committee is pulling credit unions together so a shared technology platform can be established and allow for more efficient credit union operations and service delivery to members.