Project Overview The Kingdom of Tonga

The purpose of the project is to assist the Kingdom of Tonga - Ministry of Labour, Commerce & Industries (MLCI) to conduct a feasibility study on the establishment of a Credit Union Bank in Tonga. The main objective of the project is to establish a financial entity to specifically cater for the financial needs of its members especially the poverty stricken ones.

The Aims and Objectives of the project:

• Determine the feasibility of establishing a Credit Union Bank in Tonga and the impact it will have on the economy.
• If feasible, devise the relevant model structure, identify the potential members/shareholders, and determine the required minimum capital funding.
• Gather the views and suggestions of relevant parties and potential stakeholders.
• Highlight the benefits of implementing this proposal on the low income level sector of the economy.

The feasibility study was conducted in December 2007 by a team of experts from Credit Union Foundation Australia (CUFA). The study found it viable to establish a Credit Union Bank in Tonga with support of key stakeholders in the country to cater for the financial needs of the low income groups, thus encouraging savings and investments and contributing to poverty alleviation in the country.

The team recommended development of a subsequent phase of this project resulting into the development of a business plan for the proposed CUB in Tonga. A team of CUFA experts supported by the Commonwealth Secretariat's Commonwealth Service Abroad Programme (CSAP) has developed the plan, which can be accessed from the Reporting link above.