Zucchinis and credit unions: Not strange bedfellows

I love it when credit unions display their awesomeness.

And recently, UMassFive College FCU did just that.

I was driving about Western Massachusetts, when I heard a news story on our local NPR affiliate, WFCR, about UMassFive College FCU and their new CSA loan. Here’s the one-minute radio segment about it: Credit Union loans for farm shares

This statement may raise some or all of the following questions from you:

1.) What does CSA stand for, and what is it?
2.) What is a CSA loan?
3.) Why is it a perfect match that a Credit Union should offer a CSA loan?
4.) Why is this a brilliant business strategy on the part of UMassFive College FCU?
5.) What could UMassFive do to promote their CSA loans even further?
6.) Why do I care?

Q. What does CSA stand for, and what is it?
A. CSA stands for Community Supported Agriculture. Basically it’s a cooperative farm, in a similar way that a credit union is a cooperative financial institution. Customers each purchase a share of the food that is made by the farm. For example, one share might cost $700 for the year. During the spring, summer, and fall, you come to the farm and grab that week’s share of food, the contents and amount of which will vary during the harvest season. Typically, you get a box full of fantastic fresh produce each week. Here’s an example of what Simple Gifts Farm’s produce share consists of. The photo on the right is a typical summer week’s share from Doe Run Farm, a CSA in Tennessee.

What is the advantage of a CSA? Terrifically fresh and local food. Savings over what it would cost if purchased from a grocery store. Half-shares are also often available from a CSA, which get you half the amount of a full share of the farm harvest each week, usually at somewhat more than half the cost of a full share. Often times, membership in a CSA also requires a few hours per month helping to box up the week’s harvest.

Q. What is a CSA loan?
A. A CSA loan is a loan for the cost of one year’s share. While many people might be interested in buying local, and supporting local agriculture for a variety of reasons, many of the people interested in doing it can’t afford a lump sum payment of $600-$700. So in this case, UMassFive College Federal Credit Union is offering their members a NO-INTEREST loan, payable over 6 months, to finance buying a share in the CSA. So instead of $700 in one payment, the consumer would be able to pay $117 a month for six months. For many families, they may lower their total grocery bills while receiving a plentiful amount of fresh fruits and veggies.

Q. 3.) Why is it a perfect match that a Credit Union should offer a CSA loan?
A. The sixth of the Seven Cooperative Principles states that cooperatives should cooperate with each other. Both credit unions and CSAs are cooperatives. Both are (usually) dedicated to local cooperative principles. It’s a perfect fit.

Q.) Why is this a brilliant business strategy on the part of UMassFive College FCU?
A.) Because great businesses differentiate themselves, which creates a brand unique to that business. Credit unions are the only type of financial institution which can partner with CSAs in this way, authentically. (Banks could do it, but they’d be seen as copycats. Realistically, offering these types of loans is not on any bank’s radar screen.) This loan does many things at once: Strengthens the credit union’s brand as a local cooperative, actively doing things to strengthen the community which they serve. It also helps the CSA by making it possible for more people to afford to buy shares in it. It helps the member by spreading the payments for a CSA share out over several months.

There are other benefits of of buying local food, (belonging to a CSA is one way to do it), from which the Credit Union’s brand image is enhanced by association: CSAs help reduce the nation’s overall energy consumption and greenhouse gas emissions by reducing the fuel needed to package and transport food through the wholesaler to supermarket supply chain.

Offering interest-free CSA loans is not going to add significant dollars to the CU’s bottom line, nor is it going to cost them a significant amount. But their reputation is enhanced immeasurably, and management and the board must be taking the position that the PR gained, and thus future business, will more than offset the small amount of the cost of the program. Already, being interviewed by the local NPR affiliate is fantastic marketing, which had no cost.

Q. What could UMassFive do to promote their CSA loans even further?
A. Right now, their CSA loan page has a link to a local food site. I’m not sure if UMassFive is promoting this in their lobbies and teller lines too, but if not, they should. Also, they could provide a more direct link to the CSAs that are in the same area as the majority of their members. And of course, they should get in touch with all of these area CSAs and make them explicitly aware of their interest-free loans. UMassFive could also create a CU/CSA-day event, inviting representatives of the CSA to bring samples to the CU, and make it a festive occasion, bringing both more awareness to the CSAs themselves, and to the fact that UMassFive supports them. Also, UMassFive could publicize the WFCR story about their CSA loans nationally, which if successful, will increase the pride that its members have in it.

Q. Why do I care?
A. Long before I knew what a credit union was, as a child, my mother belonged to a food coop. Now that I’ve made a profession helping credit unions, it’s great to see a credit union that is doing something that makes a lot of sense from a business and community-enhancement standpoint. And by so doing makes the world a better place.

Oh yeah, and my mother is a not only a member of UMassFive College FCU, she’s also a member of CSA Simple Gifts Farm in North Amherst. And on Thursdays in the fall, she often brings my son there to help gather the week’s share.

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6 Responses to “Zucchinis and credit unions: Not strange bedfellows”

  1. Morriss Partee Says:

    Follow-up: I wrote to my friend, UMassFive’s VP of Marketing, Jon Reske, to let him know I was writing about their new program. In his response to me he said, “We decided to make the CSA loan no-interest because we didn’t think it was very nice charging interest for food.”

    PERFECT! THIS IS WHY I LOVE CREDIT UNIONS! Nice going Jon! Congrats on a win/win/win program!

  2. Morriss Partee Says:

    I nearly forgot: Simple Gifts Farm has a Facebook fan page.

  3. Barbara Partee Says:

    Morriss — This is so nice — links from way back when we were in that Food Coop in Amherst and you guys sometimes came with me to do our biweekly work hours – all the way up to now when your son and I go over the the Simple Gifts Farm together — and I’ve been a happy member of the UMassFiveCollege FCU all that time. Your whole story makes me smile, and of course I’m glad you used two of my photos of Sean at the farm! I love what you’re doing to help bring all those good things together!

  4. Sonia Pichardo Says:

    Contact: Sonia Pichardo
    Tel: 718- 617- 7807
    Email: sonia@greenworker.coop

    1st Annual Pioneer of Change Awards Press Release


    Pioneer of Change Award is a first-time award given by Green Worker Cooperatives that seeks to recognize people, organizations and businesses who have made significant contributions to address environmental and economic problems in working communities that don’t pollute the earth or exploit human labor.

    Green Worker Cooperatives has chosen Cooperative Home Care Associates (www.chcany.org) for this award because of their contribution to the South Bronx Community by providing a positive and democratic workenvironment in quality home health care. Cooperative Home Care Associates (CHCA) is a for-profit, worker-owned cooperative that provides home health care aides on a contract basis to large health-care providers such as the Visiting Nurse Service and major hospitals. Founded in 1985, CHCA now employs more than 1600 home health aides, most of whom are women of color, and has provided a model for replication projects in Pennsylvania and Wisconsin.

    COOPERATIVE HOME CARE ASSOCIATES is a concrete, profitable example that worker cooperatives can reorient our economy and can improve conditions for workers.

    Green Worker Cooperatives, also presents this award to the South Bronx Food Cooperative (www.sbxfc.org) in recognition of their pioneering efforts in establishing the first consumer-owned food cooperative in the South Bronx and promoting cooperative ownership in the Bronx.

    GREEN WORKER COOPERATIVES (www.greenworker.coop) is a South Bronx-based organization dedicated to incubating worker-owned and environmentally friendly cooperatives in the South Bronx. Our approach is a response to high unemployment and decades of environmental racism. We don’t have the luxury to wait for new alternatives. That’s why we’re creating them. We believe that in order to address our environmental and economic problems we need new ways to earn a living that does not require polluting the earth or exploiting human labor.

  5. Christa Says:

    Excellent! I’m also really glad a regular-sized farm share doesn’t cost $700.!

    ; )

    Great blog!

  6. Credit Unions being a Cooperative « EverythingCU.com World 2.0 Adventure Says:

    […] Here is a related blog post I wrote on the 6th principle of Cooperatives, which is that Cooperatives cooperate with each other: Zucchinis and Credit Unions: Not strange bedfellows […]

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