Most of the global credit union system still sees no light at the end of the COVID-19 tunnel

In America, the future is getting a little brighter each day where the COVID-19 pandemic is concerned. More than one-third of adults have received at least one dose of a vaccine, with one in five Americans now fully vaccinated. While new COVID-19 case numbers have started to increase slightly in recent weeks, the United States is still far below the record high numbers we saw in late 2020.

Because those metrics look so positive, many of us are making plans to enjoy life the way we did before the pandemic. Some of us are planning summer vacations, while others are looking at buying new homes or expanding hiring at our businesses.

The execution of those plans will bring an infusion of money into our national economy. U.S. credit unions will see the benefits in fewer past due loans, an increase in new lending and the lowering of excess liquidity.

A different view globally

While that promising new reality is just a few months away here in America, it could still be more than one year away for credit unions in most of the world.

Just two percent of the global population has been fully vaccinated—while new cases of COVID-19 have risen to record high levels across dozens of countries.

In a recent World Council of Credit Unions’ (WOCCU) webinar that examined the COVID-19 response of Central and Eastern European credit union systems, representatives from several of our member credit union associations expressed concerns about the immediate future.

World Council member associations in Romania, Poland, Ukraine and several other countries are currently facing a new spike in cases and a third wave of lockdowns. In Ukraine, where daily new case numbers reached an all-time high in early April, COVID-19 restrictions have led to a decrease in credit union lending, as a general pessimism has made members reluctant to take on new debt. 

In Asia, a surge of infections in the Philippines, India and Thailand have led to new lockdowns in those countries. The Asian Confederation of Credit Unions (ACCU) is helping its members figure out how to respond to the impacts in the short-and-medium term. But here too, credit unions are experiencing excess liquidity and are unable to grow their loan portfolios because of uncertainties over whether their members can conduct business.

In parts of the western hemisphere, the situation is just as dire. New COVID-19 cases, hospitalizations and deaths are at record highs in several South American countries.

In Brazil, one of World Council’s most dynamic member associations—Sicredi—reports that hospitals are being forced to operate well above capacity in numerous areas. Sicredi is working to keep its own employees safe as they help member credit unions manage the crisis. They hope a very slow vaccine rollout will soon be accelerated. 

Peru and Ecuador are also dealing with record high caseloads, as our member credit unions there work to keep their employees, members and communities safe. 

Even our neighbor to the north is still struggling. A rise in COVID-19 cases combined with a slow vaccine rollout have led to a lockdown in Canada, with Ontario in the toughest shape. The countries most populous province has a stay-at-home order in effect for 40 days. While closures in place since December are starting to have a huge impact, the government continues to offer emergency funding, loan guarantees and small business grants and there is various support for rental properties.  

A commitment to press on

While this almost goes without saying, in each of the countries listed above, credit unions continue to innovate, improvise and persevere in order to continue delivering a high level of service to their members. But unlike in the U.S., the challenges they face will not be a faint memory by July. They continue to represent an all-consuming reality with no end in sight.

That is why World Council’s COVID-19 Response Committee is not going anywhere. It continues to be dedicated to identifying the best practices and strategies credit unions around the globe can utilize in their response to the pandemic, especially in the areas of advocacy, digital transformation and institutional strengthening.

Through a series of public webinars, virtual exchanges and strategy sessions with our member associations, World Council is working to ensure credit unions on six continents will continue to have access to the latest information and tools they can use to curb the pandemic’s impact on their members. 

We know our global movement will not be at full strength until credit unions in every country are on the road to recovery.