Kevin Humphreys (Dublin South East, Labour) | Oireachtas source

First, I shall reply to Deputy Ó Snodaigh. To be truthful and honest, when the Deputy raised this matter on Second Stage, I was unaware of the Lough payment scheme and misunderstood him. While the personal microfinance scheme may offer an alternative to those who remain in the Lough payment scheme, where their local credit unions are participating in the pilot, it may not provide a solution to all loans operated under that scheme. The Department is prepared to allow the Lough payment scheme arrangements to continue on an administration basis until the remaining clients, who have transitioned to alternative methods, have discharged their current liabilities. While the micro scheme may offer an alternative to that, its not particularly designed for the Lough payment scheme.

We hope to introduce regulations in respect of this matter as soon as possible. I intend to have the pilot scheme operational by the end of this month in time for Christmas. I thank the Citizens Information Board, the Money Advice and Budgeting Service, the Social Finance Foundation and the Society of St. Vincent de Paul for their assistance in designing the scheme. I hope to roll out the pilot scheme by the end of the month to 30 credit unions in the first instance. It will make an enormous difference to people who are paying up to 200% in interest. The pilot scheme will operate well, especially as it works with the credit union movement. I have met representatives of the credit union movement on numerous occasions and they are anxious to get the pilot scheme up and running. Lessons will be learned from the pilot relating to the household budgeting scheme.

Regulations have been made in respect of the household budgeting scheme and are live at present but we need new regulations for microfinance. I hope that the many people who avail of the services of the Money Advice and Budgeting Service will avail of the pilot scheme. It is a game-changer and I hope it will allow people to move away, in the long-term, from paying extortionate interest rates and being enticed by individuals who knock on their doors offering roll-over loans, etc. The initiative has received a good response. It has been spearheaded by the Citizens Information Board, which has provided assistance and back-up. The initiative has been universally welcomed. As we said when we discussed nurses, the proof will be in the detail and that is why I am anxious that the pilot scheme be rolled out. Let us learn any lessons from the pilot scheme and provide a proper microfinance system to people who have no access to borrowing.