Credit Unions, In Azerbaijan?
Access Bank got a decent treatment from me, here, here, and here. And my experience learning about Access Bank gave me a lot of general knowledge about finances in Azerbaijan. It looks like I’m going to get more practice with the financial system in Azerbaijan than I ever dreamed. I mentioned before that I will be working at a credit union, but I got an interesting glimpse into what I’m getting into on Tuesday. I’ve since learned more than I knew at this post.
My Program Manager, Elmir, pulled me out of a few sessions to take me down to Baku to meet Elçin, who I thought was my Director. It turns out that that’s not the case. Instead, he’s the Director of the Credit Union Association of Azerbaijan. He’s an incredibly hospitable man, and he greeted Elmir and me in his office. This is where I got the scoop on what I’m getting into. Get ready for some some wonkish descriptions. First, Elçin began the Association six years ago, as an opportunity to expand microfinance in Azerbaijan and improve the financial system. Credit unions have the same problems as banks here: they have very little domestic capital. Since people don’t keep usually keep money in their accounts, and Azerbaijanis aren’t investing in banks and credit unions, the institutions have very few domestic resources. When they lend money, that money has to come from international sources. In my case, this is where the World Bank comes in. The World Bank currently has a project in Azerbaijan, ADCP-II (P090887), which is geared towards improving rural investment, farm incomes, agribusiness, and agro-marketing and commerce. The World Bank gave this money to the Ministry of Economic Development, which in turn gave it to the Ministry of Agriculture, which then gave it to Elçin and his association to distribute to farmers. So, long story short, the association has a bunch of money for credit unions, and Araz Credit Union is one of those which was started with these funds.
If I remember correctly, the credit union association here has about 50 working credit unions making up the family. Elçin explained to me that his role is to facilitate the creation and development of credit unions. Anyone can start a credit union here, but it takes some know-how and government navigation. The association has a series of manuals and training materials they use in order to help the CUs get started. These go into all sorts of topics, like debt collection and record-keeping and others. He digitally handed me 12 manuals they use so that I could get started understanding what I’m jumping into. I’ve just started reading into the Financial Management and Internal Controls manuals. This stuff is rich. And it turns out that ZZ Top is an excellent accompaniment to reading credit union materials. Hopefully they don’t expect me to be an expert on Azerbaijani credit union law right away. I’ve got a learning curve ahead of me.