The Ukrainian government has shut down all of the nation’s credit unions until at least April 24 as part of its response to the coronavirus pandemic, the World Council of Credit Unions reported Wednesday.
Banks and insurance companies in the Eastern European nation have remained open but credit unions there were forced to close their doors on March 17 because they do not offer online financial services.
“The lack of digital services is the consequence of a poor IT infrastructure in the Ukrainian credit union industry,” WOCCU said in a news release.
The global trade group added that more than half of Ukrainian credit union members are over age 50, putting them at increased risk of contracting the disease if they visited a branch for in-person transactions. The average American credit union member age has been in the late 40s for decades, and most CUs across the country have
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With credit unions closed, many famers and small business owners in Ukraine that use credit unions for their lending needs could be forced to turn to predatory lenders as the spring agricultural season peaks, WOCCU said.
“Credit unions are losing revenue each day the shutdown continues — along with potentially losing members — which will likely lead to capital and liquidity issues once the government allows them to reopen,” WOCCU said.
Along with banks and insurance companies, grocery stores and pharmacies are reportedly the only other businesses permitted to operate in the Ukraine right now.
As of April 2019, the most recent data available from WOCCU, there were 78 credit unions operating in Ukraine serving just over a half-million members.
