Deposits in credit unions (CS) today are much more profitable than bank deposits and this is a fact. Indeed, if banks on deposits in hryvnia promise 12-16% per annum, then the COP often offer deposits up to 27% per annum. In particular, in one of the flagships of the ZaRaZ CS market, the interest rate is 27.5% per annum. At the same time, investments in CS are sometimes considered more risky than bank deposits. Today, most depositors believe that they have practically nothing to fear, because in the event of bankruptcy of the bank, they can count on compensation up to 200 thousand UAH. from the Deposit Guarantee Fund for individuals. But nevertheless, several banks are known whose depositors did not pay UAH 200,000, despite the fact that these banks were members of the Deposit Guarantee Fund (for example bank “Mikhailovsky”)
The system of credit unions of Ukraine does not provide for a state fund for guaranteeing the repayment of deposits of individuals. Only banks can use this “privilege” with us. Therefore, the Constitutional Court cannot rely on state support and should rely only on its own strengths and capabilities. In this regard, the COP has to find new arguments in favor of its reliability and provide additional arguments for its financial stability in order not only to maintain but also to attract additional deposits to deposit accounts from its customers.
One of the arguments for the security of the contribution to the CS for individuals is insurance of the risk of default in a reliable insurance company. This service is quite expensive, but in spite of this, some CSs incur additional insurance costs. Not every COP holds deposit insurance. Similarly, insurance companies are not ready to take the risk of non-repayment of deposits for all credit unions. In this regard, the presence of a deposit insurance service in the CS is in itself a very positive signal for the depositor, as it confirms the fact that the insurance company already trusts this Credit Union and is ready to bear risks for it. In connection with the above reasons, the number of credit unions that insure deposits, today there are only a few dozen.
But the situation is changing for the better among market leaders. In particular, at ZaRaZ CS, absolutely all deposits are insured by the Ukrainian Insurance Capital insurance company. The editors asked for a comment to the Head of the Board of the SC ZaRaZ regarding the reasons for choosing such a partner. “This insurance company earned its certainly reliable image in more than 22 years of work in the insurance market in Ukraine. Since 1995, this company has survived with honor not one financial crisis. Many insurers were sold, closed, and Ukrainian Insurance Capital Insurance Company remained a reliable partner for its customers. Therefore, we are confident in this insurance and know that all deposits are guaranteed and insured.
In turn, the ZaRaZ CS will continue to work to ensure the prosperity and financial security of the Members of our Union. ” – said the Head of the Union.