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An oxocutivo in a large and ueil knoun oast
orn manufacturing company has defined a
credit union as "a co-operativo association,
operating to promoto thrift and to create
a source of credit for provident or produc
tive purposes*"
That not only is the most descriptive and
cou5>rehensivo definition of a credit union
I have overy read, says Gail E. Spain,Vice
President of the Caterpillar Tractor Co, ,
but it also inspires me . to rocord our- ex- *
coll cut end favorable experience uith tuo
| credit unions operating in our ttro factories
; (in Illinois and California). ' I am promp
ted to offer these remarkds for publication
because of the conviction that snmo .employ
ers still question the value of credit un
ions cithor to the employees or the company
itsolf.
TWO-FOLD PURPOSE ...
The crocUt union offoctivoly fulfills its
tuo fold purpose: p.‘iking loons to employees
at reasonable rates of interest'—only 1 per
cent per month on the unpaid balance, end
providing convenient' and profitable means
for the accumulation of savings.
It lias been my personal observation that no
single benefit to the employee and hence
the employer looms so largo and important
as the opportunity afforded by a credit un
ion for members to borrou funds on the ir
personal character uhen It 10014* otherriso
be impossible, or if! possible only at usur
ious interest rates*' The credit union under
those circumstances is sympathetic, helpful-,
does not rosort to hard,, cold collection
and foreclosure practices, This vory atti
tude encourages the borrorring of funds vhen
t'orrisomc trouble dictates the ..desperate
need for quick fund,s--usually in compari
tively small amounts.
THE EMPLOYER PROFITS' ' "
The employer prof it3 in a very real' and
tangible sopsefrom this relationship.The
loss of valuable time by calls of creditors
garnishments afe;greatly reduced by-an
act ivo credit union. Moreover, worry which
has ruined the happiness of more employees
than perhaps any other factor, is minimized
by participating membership in credit un
ions—directly contributing to increased
efficiency*
TRULY GLOBING EVIDENCE .
Itr. Spain points out—-I uould not havo you
infer that the business affairs of the so
credit unions are loosely administered.
Actually, members must pay off thoir loans (
in accordance uith a prearranged program. l i
Credit Unions are, houorer, better situated
to judge the ability to pay and recognize
tho soundness of a member’s need for a loan.
Collections are taken to court only in e:;~
tromo cases. History records that losses *
on loans by credit,union«s have avoragu.d lor
many years but approximately 7 cento per
hundred dollars loaned—truly glouing cvl
donce of their sound businoss management*
To bo continued next u.eek.