Indonesia with a population of two hundred and forty five million is a middle-income country that is showing strong economic growth. Such growth is evident from the sight of an endless stream of motorcycles on the streets, which used to be bicycles a decade or so ago. Motorcycles have become the main vehicular means of the lower end of middle-income earners. My second visit to the island of Bali after just over a year shows caterpillars and cranes still actively working, as new industrial buildings and rows of shops are being built along the Sunset Boulevard.
Against this backdrop one could also witness hard working Balinese folks sustaining rice production in rural rice fields and terraces, as well as in the booming informal sector in urban sites. These people are the ones still left behind by capital-rich entrepreneurs who are coming from other regions of Indonesia to set up business in this famous and flourishing island.
I had the opportunity to revisit the Kubu Gunung Credit Union. This credit union started with just 15 people in a retreat house in 1991 and its current 4700 members decided to build their own office-cum-training centre at the periphery of Denpasar (the Capital City of Bali). Members, under the innovative leadership of Frans Supriyanto – founder of this credit union – would simply like to show the world what low-income people could achieve if they all work together in tandem from the ground up. The new Kubu Gunung Credit Union Centre, which I had the pleasure of visiting and opening a year ago, has now developed into an impressive facility that equals a modern office – cum – minimalist hotel that one can find in any modern city. During my visit last year it was still a half finished building full of bricks, sand and stones; it has now been magically transformed into such a modern facility.
However, while impressive, the most important thing is not the material or physical growth of Kubu Gunung credit union itself but more significant is the innovative way by which low-income and poor members are being served to fulfil both their financial and household needs. Training and education are indispensable in their sustainability programs, so as to inculcate the habit of thrift, and hence members are able to save regularly and borrow responsibly.
Yet Kubu Gunung Credit Union has not stopped at simply providing training and education, or at intensifying savings and loans services to their members, it has also ventured innovatively into forming Consumer Co-operatives (called Consumer Union) by loaning out and investing some funds into this new and independent co-operative venture as a stakeholder. Such investment is done without adversely affecting the liquidity needs of the credit union.
Kubu Gunung does not stop at just helping low income members in the urban area. In collaboration with a credit union-linked foundation they build greenhouses as demonstration plots to teach farmers how to grow high quality vegetables and cut flowers. Farmers then borrow from their credit union to buy good seeds produced in these greenhouses in order to plant vegetables and flowers in their own backyards. This horticultural effort is meant to increase farmers’ production, hence income, backed by the Consumer Union which does the marketing and sales activities.
This is a truly holistic approach in co-operative development from the ground up, which resists instantaneous results and instead opts for more long- term sustainability of farmers and other credit union and consumer union members. While challenges abound, innovation continues to be created alongside intensive supervision, so as to provide stable, sustainable, beneficial and meaningful services to members.
A great visit …