This study examines the bankruptcy of MCU, a large credit union in West Java, after 30 years of an excellent reputation. It explores how the mismanagement of trust and leadership contributed to institutional collapse from a social entrepreneurship perspective.
The research employs content analysis of institutional documents (2022-2023) and qualitative in-depth interviews with key stakeholders conducted in 2024.
The findings reveal that trust, as a form of social capital, was significantly eroded. Strong networks and kinship ties created opportunities for conflicts of interest and abuse of power, ultimately leading to bankruptcy and declining member trust.
This study highlights the paradoxical role of social capital as both an asset and a liability in credit union governance.
Future research may expand to other dimensions of social entrepreneurship using different methodologies.
Manurung, E. M. and Basudewo, B. (2026): The Paradox of Social Capital in Credit Unions: A Case Study of Credit Union Bankruptcy from a Social Entrepreneurship Perspective. World Journal of Entrepreneurship, Management and Sustainable Development (WJEMSD), Vol. 22, No. 4, pp. 333-351.
