Credit unions want new law

Wednesday, April 9, 2003

Ecuador's credit unions are working on legislative proposals that would give their industry its own regulations and regulatory body, local daily El Mercurio reported.

Credit unions with assets of more than US$1mn are currently under the jurisdiction of the banking regulator, thus splitting the industry into large and small companies.

"We credit unions are one nationwide and we should be regulated by similar legislation and very similar regulatory bodies unique to all cooperatives," Hector Fajardo, chairman of local credit union Union de Cooperativas de Ahorro y Credito del Sur (UCAC-Sur), was quoted as saying.

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Fajardo added that the credit unions are not against regulation, rather sector oversight should be carried out by a specialized regulatory body.

The existing cooperatives law is considered by credit unions as too general, while regulations for financial institutions contain only four articles relevant to the administration of credit unions.