Saturday 17 August 2019

Banks stifling credit unions

A motion calling on the government to remove restrictions on credit unions which are preventing them from providing competitive services to local communities was backed unanimously at the meeting.

The motion - by Cllr James Browne and Cllr Michael Sheehan - outlined how the credit union movement is critical to the economic and social wellbeing of communities all over Ireland with almost three million members and nearly 4,000 office nationally.

They said that the sector, which primarily offers savings and loan services, employs 4,000 people and has almost 10,000 volunteers.

'Credit unions have survived the crisis well with just 1 per cent of credit unions needing State funding support since the financial crisis began. The not-for-profit and independent nature of credit unions is vital to the success of the sector and in other jurisdictions the role and function of credit unions is clearly set out at a national level policy.'

The councillors said in their motion that the sector is overburdended with restrictive limitations which are disproportionate to the nature of its lending, adding that this is stifling the growth potential of credit unions.

Cllr Davy Hynes described the credit union as one of the most important institutions in the country.

'Families in the lower income brackets have had to avail of the credit union for all sorts of reasons. The pressure that is coming to stop them from getting into full flight is probably coming from the banks. These same banks destroyed the country and all they want is more and more money. I hope that credit unions will be allowed to grow and develop their banking facilities, which were previously denied to them.'

Cllr Deirdre Wadding also supported the motion. She said the credit union organisation has a very different vision to the banks.

'We have to do everything we can to stop them becoming mini banks. They want to put the funds into housing.'

The Irish League of Credit Unions (ICLU) is actively considering offering mortgages to their customers. The organisation said in February that it was examining the provision of home loans but that such a move was at least 12 months away.

Cllr Sheehan said people living in every part of the country have access to their local credit union and have benefited from the services they provide.

Wexford People

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