Iowa Community Credit Union

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Credit Union Milestones The foundation for the credit union movement in the United States was laid by a handful of men who had a strong belief in "people helping people," which has now become the cornerstone for credit union philosophy. The credit union movement began in America as a cooperative effort among common people to pool their money and share it among one another. A Massachusetts banking commissioner, Pierre Jay, and a Boston merchant, Edward A. Filene, became interested in credit unions in the 1900s, which were being formed in Canada by a man named Alphonse Desjardins. As banking commissioner, Jay monitored unauthorized banking practices in Massachusetts. He learned that several groups of employees in the commonwealth had started their own savings and loan clubs. Jay believed these associations were providing a needed service, but he wanted to recommend a way to make them legal. Jay turned to the work of Desjardins, and in 1908 the two men met with Filene and other supporters in Boston. Desjardins and Jay then prepared the legislation for the first general state credit union act in the United States. It passed in 1909. In 1921, Filene sought federal legislation and more state laws as a means to encourage the formation of more credit unions. He created the Credit Union National Extension Bureau and hired a Massachusetts attorney, Roy F. Bergengren, to help him. So committed was Filene that when the Bureau faced financial difficulties, he funded it with his own money. Bergengren's role at the Bureau was to seek effective credit union laws in all states and at the federal level. When he brought his message to Iowa in 1923, the economic situation was not promising. Average workers were unable to save or borrow money, banks were failing, interest rates were high (anywhere from 42% to 250%) and people were looking for new solutions to their money problems. Bergengren was convinced our state was ready for a credit union organization. He worked with local supporters to sponsor a Credit Union Act, and it became effective July 4, 1925 in Iowa. The law allowed groups to form credit unions in the state, which they did with enthusiasm. By late 1929, just before the stock market crash, Iowa had 37 credit unions; most with about 100 or 150 members each. Supportive legislation was being passed in other states as well, and the credit union movement continued to grow. Credit unions soon discovered they could further expand the growth of the credit union movement by joining together in leagues. These leagues, formed at the state level, provided financial and legal advice, spread the credit union philosophy, and organized supporters to gain favorable laws. The Iowa Credit Union League opened its doors in 1930 with a tiny staff in a downtown Des Moines office. More than 75 years later, the Iowa credit union movement is still strong, vibrant alternative to for-profit banks, serving their nearly 1 million members, or one out of three Iowans.

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