In celebration of Black History Month, we would like to take a moment to reflect upon the rich history and role of credit unions in African American communities, many of which were created with the people helping people spirit that has driven the credit union movement for years.
Not long after the foundation of early credit unions in North America, the first black credit unions were established in the 1920s and 30s. Their mission: help struggling black farmers and urban groups move toward economic self-sufficiency against a backdrop of prejudice and discrimination in the early twentieth century.
As the Civil Rights movement gained momentum in the United States in the 1950s, so too did the establishment and growth of black credit unions. In fact, Martin Luther King, Jr. and the Montgomery Improvement Association (MIA) applied for a federal charter for a credit union.
Originally created to handle the logistics of the Montgomery Bus Boycott following Rosa Parks’ refusal to give up her seat, the MIA became a force for advancing other civil rights issues—including the creation of a credit union. However, King’s and the MIA’s application was turned down on the basis that the association was too wide a field of membership.
With racial discrimination in the banking and housing industry being an unfortunate, but very real part of U.S. history, black-owned banks and credit unions played a significant role in helping African Americans establish credit history, start businesses, and achieve the American dream of home ownership. Under President Johnson’s “Great Society” reform package during the sixties, hundreds of credit unions were formed to help underserved or lower-income groups, many of them black-owned or black majority held.
Though many of these institutions closed during the financial upheaval of the 1980s, black-owned and managed credit unions still play a critical role in providing financial services to communities that have been traditionally underserved or unbanked.
In 1999, the African American Credit Union Coalition (AACUC) was formed to “increase the strength of the global credit union community.” Its goals and objectives include promoting diversity through advocacy and professional development. Today, the AACUC offers a unified voice to help improve the economic development of communities often under-served by major financial institutions. WPCU is proud to have forged a recent partnership with the AACUC, to provide resources and support for our partner-employees and credit union communities nationwide.
As we celebrate Black History Month, we remember the important role of black credit unions played in advancing economic equality and the credit union movement. We can also reflect on our own credit union’s goal of promoting financial flexibility and freedom for all.