Brazilian credit unions are experiencing unprecedented growth and recognition. With over 21 million members and a presence in more than half of the country’s municipalities, credit unions have become essential for financial inclusion, regional development, and the modernization of Brazil’s financial system.
Origins and evolution of the Credit Union movement in Brazil
The cooperative banking movement in Brazil began in 1902 in Nova Petrópolis, in the southern state of Rio Grande do Sul, with the creation of the first credit union by Swiss priest Theodor Amstad. Inspired by the German Raiffeisen model, the initiative spread rapidly through rural and underserved communities.
In 1925, the first central credit union organization was created, paving the way for the development of today’s structured systems. Over time, Brazilian credit unions evolved into regulated financial institutions, fully integrated into the national financial system.
Strong Growth and National Presence
Over the past decade, credit unions have increased their share of Brazil’s total credit from 5.9% in 2015 to 12.9% in 2025.
Today, Brazil’s cooperative financial sector is the sixth largest financial group in the country, with over 10.000 service points, more than 21 million members, and a presence in over 3,200 municipalities — accounting for 57% of all Brazilian cities. In more than 400 municipalities, the credit union is the only financial institution present.
This growth is even more remarkable considering that commercial banks have been closing branches in small and medium-sized cities. In contrast, credit unions are expanding their physical footprint, supporting local economies and especially the agribusiness sector, which makes up about 25% of Brazil’s GDP.
Local Development Based on Each Region’s Strengths
Credit unions play a unique role in driving the local economy. They understand the economic profile of each community and offer personalized financial solutions that support agriculture, local commerce, industry, and services. Profits are reinvested locally, stimulating economic cycles, job creation, and quality of life.
Proven Social and Economic Impact
According to a 2024 study by FIPE (Fundação Instituto de Pesquisas Econômicas) and the OCB System (Organização das Cooperativas Brasileiras), every R$1 in credit granted by a credit union generates R$2.56 in local economic impact.
The presence of credit union also contributes to:
- Encouraging local entrepreneurship and the formalization of businesses
- Job creation and support for small enterprises
- Improving the per capita income of communities served
Municipalities with active credit unions show improved development indicators:
- 24.8 fewer families per 1,000 enrolled in the federal Bolsa Família program
- 24.1% increase in higher education enrollments
- Lower poverty rates and improved financial resilience
Economist Juliano Assunção (PUC-Rio) also found that credit unions are operating in areas where traditional banks have withdrawn, proving that cooperatives are essential for inclusive rural finance and regional sustainability.
The Central Bank Recognizes Credit Unions as Strategic
According to the Central Bank of Brazil, credit unions play a vital role in expanding financial access, offering fairer rates, promoting financial education, and strengthening economic participation.
Brazil is one of the few countries where credit unions are fully integrated into the national financial system, with the same legal powers as traditional banks. They are supervised, regulated, and allowed to offer the full range of financial services. A unique aspect is the cooperative act, which entitles them to specific tax benefits.
The Central Bank also considers credit unions key partners in promoting:
- The expansion of Open Finance
- The launch of automatic Pix payments
- ESG-driven sustainable finance
Credit Unions in Brazil
The National Credit Union System (SNCC) is composed of five major groups, each with its own structure, reach, and governance model. Together, they form the backbone of Brazil’s cooperative financial movement: Sicredi, Sicoob, Cresol, Ailos and Unicred.
Collectively, these systems manage:
- R$803 billion (US$146 billion) in total assets
- R$514 billion (US$93.5 billion) in deposits
- R$455 billion (US$82.7 billion) in credit portfolio
Support for Agribusiness and Small Enterprises
Brazilian credit unions are the second-largest lenders in rural credit and maintain strong relationships with small businesses. Of the 1.5 million business members, about 97% are micro and small enterprises.
In southern Brazil, cooperatives are responsible for nearly 30% of credit to small businesses, reinforcing their importance to entrepreneurship and job creation.
Innovation, Digitalization, and ESG Commitments
Credit unions are investing in digital transformation, offering Open Finance integration, digital banking services, and fintech-like experiences. At the same time, they maintain strong local relationships and humanized service.
In the ESG space, initiatives include green credit lines, environmental finance products, social impact projects, and transparent sustainability reports.
A Resilient and Inclusive Financial Model
Credit unions in Brazil are not just an alternative to banks — they are leading a new financial era. With democratic governance, community focus, modern technology, and measurable social impact, they offer a resilient, inclusive, and future-ready model for financial services in Brazil and beyond.