Educating and Financing the Poor: Credit Union Promotion Club

This is a project located in #Malaysia.

Related SDGs:

  • #SDG1 (No poverty)
  • #SDG2 (Zero hunger)
  • #SDG4 (Quality education)
  • #SDG8 (Decent work and economic growth)

Data collection methods: Interview

Updated since: 2014


The Credit Union Promotion Club (CUPC) was founded in the 1970s and registered under the Society’s Act in 1974. It was initiated by some community leaders who wanted to use a financial entry point to help the poor and needy within their communities. The main function of the CUPC is to establish and support credit unions, which are non-profit co-operatives that provide financial services to their members, by linking savers and borrowers in the same community. Credit unions pool the funds of members to provide capital and do not rely on external funding. The non-profit nature of the co-operatives enables the members to have higher returns on their savings and lower interest rates for their loans, as well as less fees to pay.

The CUPC provides education and training programmes related to co-operative administration, management and financing. It provides a platform for like-minded co-operative organisers (mostly from churches and NGOs) to discuss issues faced by their co-operatives, and to network with registered credit and other co-operatives. The CUPC plays a role to help co-operative leaders to understand globalisation processes and their impacts on local co-operatives and communities. It also acts as an internal monitor and evaluator for co-operatives within the Club.

The CUPC also does pre-credit union organising work, targeting the urban and rural poor, including plantation workers, indigenous communities, squatter communities, factory and industrial manual workers, land settlers, flat dwellers, small business owners, drop out youths, as well as single mothers and widows. Credit unions are important for the poorest 40% of the nation because they lack the access to financial services and social mobility. The CUPC aims for holistic human development of the community, through financial intermediation. The three-pronged approach used is: 1) eradication of poverty, 2) eradication of ignorance, and 3) empowerment of local leadership. Credit union promoters go to poor communities and understand the problems faced, and provide them with support and educate them through non-formal curricula.

Some facts and figures (numbers as of 31 December 2013):

  • Number of credit unions organised –502
  • Total membership – 49,079
  • Children’s membership – 34,000
  • Monthly savings – RM57,148,819.03
  • Special savings (including children’s savings) for 2013 – RM17,740,962.58
  • Profit for 2013 (of 502 credit unions) – RM4,603,278.04

Paul Sinnappan, CUPC’s founder

Philosophy/Values/Traditional knowledge

The concept of credit unions was brought into Malaysia by a Jesuit-run organisation, the Social Economic Life in Asia (SELA), in the year 1966. It was then picked up by social workers and priests from the Catholic Church in Malaysia, which then sent some students abroad to learn about the concepts and implementation of credit unions. Besides its Catholic Christian roots, the CUPC is inspired by several different strands of ideology, including Paulo Freire’s Pedagogy of the Oppressed, Antigonish principles, and the principles of cooperatives as stipulated by the International Cooperative Alliance.

Organisational model

CUPC is a registered society in Malaysia.

Sustainability from the Triple Bottom Line

Environmental Sustainability:

  • The environmental impact of the CUPC’s activities mainly centres on environmental education. Among topics covered are water and energy conservation, the importance of organic farming and traditional natural remedies, as well as problems of plastic pollution and mass deforestation.
  • The CUPC also adapts lessons from “Sittars” in India, explaining that air, water, sky, earth, as well as flora and fauna exist not only in nature but also in human beings.
  • As part of their work with indigenous co-operatives, CUPC spearheads studies of indigenous knowledge on preserving nature and using medicinal plants.
  • It also works on protecting customary land rights and fighting against land grabbing by introducing land mapping.

Social sustainability:

  • The focus of CUPC is poverty alleviation and community empowerment through providing funding, education and opportunities to the poor and marginalised. Through identifying vulnerable communities and propagating the adoption of credit unions, the CUPC’s outreach team builds trust with the underprivileged and provides them with skills and knowledge to lift themselves out of debilitating circumstances.
  • The education programmes provided include practical skills (e.g. accounting and business development), values and mind set shift (e.g. self-reliance), and understanding of structural issues that form their circumstances (e.g. globalisation).
  • An important part of organising credit unions is the community-building that also happens in the process, which is instrumental in creating social capital and lifting communities out of poverty. The financial services provided to the community, such as insurance and small loans, also acts as a social safety net.

Economic sustainability:

  • The operation costs of the CUPC are kept low. Various sources of income include training and consultancy fees, membership fees, interest from credit unions, etc. Fixed costs are low because the offices are owned by the organisation, and many of the credit union leaders work as volunteers or are compensated modestly.
  • The registered credit co-operatives are also now making enough of profit to manage and administer themselves, owning their own buildings, paying their own staff, covering all administrative expenses and conducting in-house training programmes.


  • The main challenge faced by the CUPC is the demographic shift of the poor in the country. While it used to focus on the rural poor, urban poverty has become the norm rather than the exception. The main difference between the “old poor” and the “new poor” is the disintegration of communities in urban areas, leaving no social support for the vulnerable. What was done in the past was to engage the whole community to solve social problems and to establish credit unions; however in urban areas of scattered nuclear families, trust-building becomes a much harder process. As urbanisation speeds up, the types of social problems faced also become increasingly complicated, such as alcoholism, gangsterism, prostitution, violence against women and so on. As such, CUPC has had to revise their training programmes to adapt to the changing circumstances.

Featured image: Paul Sinnappan, CUPC’s founder speaking at a conference for social change via businesses for Christians. Picture Credit: