Bankalisation

Bankalisation (or bankalization) is the process whereby organisations (in this case financial co-operatives - Credit Unions) mutate from a small-medium financial institution into a medium-sized bank offering compatible products and services to high street banks and building societies. The essential difference is that, due to the lack of resources, it will mostly serve a local clientele rather than a nationwide one. That is unless it can create the necessary conditions via strategic alliances, mergers, acquisitions and franchise, with similar organisations who operate in different parts of the country, that will allow the organisation to acquire a larger customer base and a nationwide coverage. Nevertheless, a pre-requisite for that process to successfully take place is, as it should be for every sector of the economy, that there is no governmental, i.e. external, financial support.

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The term and the definition of ‘bankalisation’ (or ‘bankalization’) has been coined by Michael C. Handrinos.
Handrinos, M. C. and Nikolopoulos, K. (2006) The mutation of the British Credit Union movement: a critical approach to its bankalisation process. 7th International Conference of the faculty Management Koper, pp. 1311-1319.

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