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Citizens make pleas for home-grown financial institution

“If you want the profits to stay here, you need a credit union”

GREG YOUNGER-LEWIS

Iqaluit Centre MLA Hunter Tootoo joined government workers, unionists, politicians and business owners recently in Iqaluit to plan the creation of a credit union in Nunavut. (PHOTO BY GREG YOUNGER-LEWIS)

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Iqaluit residents officially kickstarted a grassroots movement last week to launch a credit union in Nunavut, with an energized meeting of volunteers who say such a financial institution will beat banks at putting Nunavummiut’s financial needs first.

About 20 government workers, union members, politicians and business owners gathered at the Nunavut Employees Union building on Aug. 5 to discuss how they can best ensure that Nunavut has a credit union in the coming years.

Louise Kilby, a former economic development worker, said setting one up will be difficult, but worth it. She said credit unions ensure that residents have a safe place to put their money, without the worry of their branch closing down because they want to make more money elsewhere.

Kilby was referring to the Bank of Montreal’s recent decision to close its Nunavut branch because it wasn’t making enough money for the bank’s central office in Montreal. Nunavummiut will soon be left with two banks in the territory, the Royal Bank and CIBC.

Kilby, who first joined a credit union in B.C. in the 1950s, said credit union members can count on a Nunavut credit union to stay in the territory, because its mandate will be to spread profits back to its members, similar to the co-op stores.

“If you want the profits to stay here, you need a credit union,” she said.

Some meeting members cautioned that the credit union movement needed to be practical and start small, possibly with an office based in Iqaluit. Eventually, once the credit union was up and running, it would branch out into the communities.

But other members spoke optimistically of immediately setting up a network throughout Nunavut with the help of Arctic Co-operatives Ltd., which runs the co-op stores.

Hunter Tootoo, MLA for Iqaluit Centre, said a credit union would be the ideal way to offer financial services in Nunavut communities.

“I think it’s the only option that will work in the communities because credit unions are not there to make money,” Tootoo said. “A financial institution like a bank isn’t going to go to the communities if they can’t make money.”

In order to set up the credit union, Tootoo said local and territorial governments, Inuit associations and economic development agencies must be involved.

Tootoo wrote a letter last week to a long list of politicians, calling on them to help form a working group of major stakeholders, including the government of Nunavut.

The letter was addressed to Finance Minister Leona Aglukkaq, Economic Development Minister David Simailak, Nunavut Tunngavik Inc. President Paul Kaludjak, and others, including Nunavut MP Nancy Karetak-Lindell.

In his letter, Tootoo notes that the GN and NTI promised to create a “community savings and loans network, such as... credits unions,” in their Nunavut Economic Development Strategy, signed last year. The government and NTI made specific reference to using the credit union to support small and Inuit business development.

NTI and the GN are expected to release a report in 2005 on how much progress they’ve made on that promise.

Johnny Mikijuk, a 44-year-old contract business owner, said he attended the recent credit union meeting because he believes it would treat Inuit entrepreneurs better than banks do.

Credit union supporters argue that banks often refuse loans to low-income Inuit because they don’t have a credit rating.

He said a credit union would also be a good way of keeping Nunavut’s wealth from leaving the territory.

“I think with a credit union, at least money will be used in the community a bit more,” Mikijuk said.

The volunteer credit union committee will meet next in Iqaluit on Sept. 11. Residents outside the community are welcome to join by telephone. For more information, call Yvonne at 979-0777.

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