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Financial Services Mutuals

Financial services mutuals are self-help organisations that generally engage in deposit taking and lending to their members. They primarily provide financial services to the consumer finance and housing markets.

Australian financial services mutuals, otherwise known as customer owned banking institutions, are subject to the same rules, regulations and legal standards as banks.

They are Authorised Deposit-Taking Institutions regulated under the Banking Act 1959 by the Australian Prudential Regulation Authority (APRA) and are incorporated under the federal Corporations Act 2001. (Non financial co-operatives are incorporated under state co-operatives legislation.)

While today's customer owned banking institutions offer similiar services, their original purpose differed markedly.

Building societies first appeared in Australia in the 1840's, and until recent times, where primarily small regional home lenders. Credit unions appeared after World War 2 offering consumer banking services.

Since financial deregulation in the 1980's, the number of financial mutuals in Australia has declined, either through mergers with each other or demutualising and converting to a bank.

As of July 2021, there were 66 customer owned banking institutions in Australia, with $122 billion in deposits and assets in excess of $153 billion, serving over 4 million customers.^

In recent years, co-operatives have been formed by ethical advisors and investors to provide financial asset advice and services.


  Mutual Banks   Co-operative Housing Societies
  Building Societies   Friendly Societies
  Credit Unions   Financial Asset Investing


To promote competition in the Australian banking system, the federal Labor government in 2010 introduced reforms allowing large credit unions and building societies to use the term 'bank' in their name.

As of June 2021, there were 31 mutual banks registered with APRA.

Further information:   Customer Owned Banking Association


Building societies offer a range of financial services to the housing finance market. They operate in much the same manner as banks in that their members enjoy integrated financial services such as home loans, saving accounts, cheque accounts, credit card access and financial planning and investment services.

Building societies have their roots in the self-help movement which evolved in England towards the end of 18th century. They first appeared in Australia in the late 1840's and for the next 100 years, were relatively small regional financial institutions. From 1950 - 1970, the high demand for home ownership saw a rapid expansion of the number of building societies, peaking at 178 in 1975.

Since the deregulation of the banking industry in the 1980's, most building societies converted to banks or merged. As of July 2021, there was one building society registered with APRA.

Further information:   Customer Owned Banking Association


A credit union is a savings and loan co-operative consisting of a group of people who have agreed to help each other by regularly saving together and lending these savings to one another at the lowest possible rate of interest. Credit union members are not motivated to make profits, but by the desire to improve the financial well-being of themselves and fellow members. Typically, credit unions charge less than the major banks in loan interest and offers competitive deposit rates.

As of July 2021, there were 34 credit unions registered with APRA.

Further information:   Customer Owned Banking Association


Co-operative housing societies have over a 80 year history of assisting low to moderate income earners to purchase their own home. They do this by partnering with government to provide loans on more favourable terms to those available from banks, building societies and securitised lenders.

As access to government home purchase projects have been severely restricted in recent years most have sought to diversify their services by also operating as a mortgage broker and offering general home loan and investment loan products through their branches.


Friendly societies had their origins in the English industrial revolution in the 19th century. Factory workers and labourers banded together to pool regular contributions into a central fund to insure their families and themselves against poverty as a result of illness and death.

Friendly societies are self-help organisations that have existed in Australia since 1836. They were formed to provide welfare services to their members including the supply of medical services, sick pay, and funds for those who have fallen on hard times. They often provided the only organised social activities available in the early years of colonisation.

As friendly societies grew, their services became more diverse. Over the years, friendly societies initiated pensions for the aged and permanently disabled, unemployment cover, and allowances for travel in search of work.

With the emergence of government supported welfare such as pensions, unemployment and sickness benefits, friendly societies modified their role and activities to provide other services to their members, such as superannuation, investments, insurance, retirement villages, hostels, travel services and holiday facilities.

Today, friendly societies primarily offer financial products including investment and funeral bonds, scholarship plans and risk insurance. As of the end of 2020, there were 10 friendly societies registered in Australia.


Australian Equity Co-operative Ltd
Delight Co-operative Ltd
Ethical Advisers' Co-operative Ltd
Organic & Regenerative Investment Cooperative Ltd
Queensland Lifestyle Co-operative Ltd
The Innovation Co-operative Ltd

^ Source: Customer Owned Banking Association

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