Corporate One's Work With WOCCU on Shared Branching Solution in Bolivia May Pay Off for Other Developing Countried

COLUMBUS, Ohio – Kurt Lykins has been in the credit union industry for 13 years, but he’s never been so touched by the people helping people philosophy than he was with the corporate’s involvement in helping Bolivia credit unions develop a shared branching system. Corporate One, along with the Ohio Credit Union League, signed an agreement with World Council of Credit Unions three years ago to help Bolivia’s credit union system. The $2.2 million project is aimed at helping credit unions open branches in remote locations and forming a shared branch network. Another goal was to develop a second tier cooperative to provide economies of scale to Bolivia credit unions. That second tier would be similar to the second tier role corporates play in America’s three-tier system. “In Bolivia it’s very much a cash-based society. It’s also very much a distributed family type environment. Males go into larger cities to work. Women and family stay in the smaller towns. Periodically they will take all the cash they earned and travel back to their home in order to deliver money back to their families. It’s a high-risk situation,” said Lykins, Corporate One’s vice president and chief technology officer. Bolivia’s credit unions are mainly located in less populated areas outside of the major cities. Bolivia’s three main cities have a bank presence, but no credit unions. Corporate One wanted to help connect all of the credit unions so Bolivians don’t have to travel miles and miles with cash to their credit union location. On a trip to the Amazon region, Lykins met with a credit union member who explained how there is nothing for her to spend her money on in her own village. She has to wait until a boat comes down the Amazon with goods for her to buy. She belongs to the credit union solely as a place to keep her cash. Lykins said he was moved by the simplicity of their lives and quickly saw the need for them to have more access points to credit union services so they don’t have the added risk of traveling long distances with cash. “It really touched my heart to work with a developing country and see that it’s not bank versus credit union. Credit unions are really only there to support the families that belong to them. It gave me a lot of additional interest in working with these types of situations that have a social element,” said Lykins. Corporate One went to work on developing a low-cost, Web-based shared branching software package to allow credit unions to talk to each other. Corporate One was a good source for this expertise given its own network efforts, including as facilitator of its AllianceOne surcharge-free ATM network. The corporate developed ServiRed, which translates as “service network.” It is a simple shared branch system similar to an off-line ATM program in the Untied States. It is housed in a rapidly developing corporate credit union in Cochabamba. “Any credit union part of shared branching can authenticate the owner of that account and facilitate the exchange of money from those accounts,” said Lykins. The amazing thing, said Lykins, is the whole project only took Corporate One about 270 hours over a three-year period. Those 270 hours helped change the infrastructure of the country. Now 17 credit unions with 40 locations and 220,000 members are connected. Lykins hopes to see that expand to 100 locations and 500,000 members by year-end. With a total population of 8.8 million, ServiRed would be connecting approximately 6% of the population. Now that the credit unions have a centralized location for information, it opens up the door to new offerings. Already, WOCCU has used ServiRed to being offering international remittances through IrNet. “We believe that this software system has the capacity and flexibility to serve as the solution for many of the technical applications we’re working to address in other projects around the globe – including international remittances, debit/credit card networks, and ATM processing,” said Pete Crear, CEO of WOCCU. “In terms of its potential, it may be one of the most valuable contributions we’ve received from a partner in years,” he added WOCCU is considering using ServiRed in Kenya, Ecuador and Barbados. “When we designed the software, we designed a language engine. The prompts can be changed, so it’s not just for Spanish speaking people. It can be changed into whatever language they want,” said Lykins. [email protected]