Kieran O'Donnell (Fine Gael) | Oireachtas source

Deputy Michael McGrath referred to market failure. The law of unintended consequences may arise here. The Deputy stated the Central Bank of Ireland would intervene if an entity charges an interest rate that is one third higher than the average variable mortgage interest rate. Could this have the unintended consequence of preventing other mortgage providers from entering the market? Perhaps the Minister or his officials will indicate how many new mortgage providers have entered the market in the past year. Given the small number of providers, I am concerned that there will be a lack of competition in the market. The provision with respect to charging an interest rate one third above the average interest rate would result in people paying a higher rate than they would pay if there were an appropriate number of new entrants in the market. Will Deputy Michael McGrath respond to my point that this measure could have the unintended consequence of creating a barrier to entry for mortgage providers seeking to enter the market and would not have the desired effect of driving down interest rates?