How CUDGC Came to Be

The Birth of Credit Unions in Saskatchewan

Life was tough during the Great Depression in Saskatchewan. Droughts ruined farms, banks shut down their rural branches, and borrowing money became almost impossible. People needed help to rebuild their lives.

Enter Barney Arnason, an economist from the Department of Agriculture. He believed credit unions—community-based financial institutions owned by their members—could help. Arnason studied successful examples from the U.S. and Europe and shared his ideas in 1934 at a co-operative conference. By 1937, Saskatchewan had its first six credit unions.

Credit Unions Take Root

The credit union idea spread quickly. The provincial government created a department to support the growth of credit unions, with Arnason as the leader. For 30 years, government workers helped set up credit unions in nearly every Saskatchewan community. These credit unions provided loans and a safe place for people to save money.

Protecting Deposits: The Start of the Mutual Aid Fund

Hard times hit again in the 1950s. Poor crops and shipping problems hurt farmers. On top of that, two rural credit unions lost money due to criminal activities, putting their members’ deposits at risk. Other credit unions stepped up, creating a fund to help protect depositors.

In 1953, Saskatchewan credit unions established the Mutual Aid Fund and the Mutual Aid Board to manage it. The fund, the first of its kind in North America, ensured people’s money in credit unions was safe, even during tough times.

Gaining Strength

The Mutual Aid Fund grew into a more formal organization, later renamed the Credit Union Deposit Guarantee Corporation (CUDGC) in 1983. By then, it had become clear that credit unions needed stronger protections and more independence. New laws introduced in 1972 ensured every dollar deposited in a Saskatchewan credit union was guaranteed by law, not just promise.

Major Regulation Changes

In the late 1980s, new laws gave CUDGC the responsibility to monitor and regulate credit unions, ensuring they operated safely. This “prudential self-regulation” meant credit unions were responsible for managing risks, but under the watchful eye of CUDGC.

By the late 1990s, CUDGC received even more power to create requirements and oversee credit unions. Over time, as credit unions grew larger and handled more money, CUDGC adapted its requirements to keep deposits secure.

Always Adapating

The world keeps changing, and CUDGC has changed with it. CUDGC has worked to keep deposits safe while helping credit unions grow and serve their communities.

Deposits are Safe

Thanks to CUDGC, no one has ever lost a dollar deposited in a Saskatchewan credit union due to credit union failure. It started as a small effort to help farmers during hard times and grew into a system that protects credit union members today.