Mr. Tim Molan:

Comparing PCPs with personal lending is not comparing like with like, in that if someone gets a loan from the credit union to pay for his or her car the car belongs to that person. The person gets the value there and then. A PCP is a completely different type of arrangement and there is a fundamental area that needs to be addressed in this. One needs to go back to consumer protection because there is an actual conflict of interest. We provide financial services and we are carefully and rigorously regulated in the interests of the consumer. Someone going to a forecourt will be sold a car. We do not sell cars and it is not our area. However, that person will also be sold credit at the forecourt. The regulation of the provision of credit needs to be looked at because one must lend responsibly. There is further work to be done on this.

The differences between credit union rates for car loans and PCPs must be taken into account, with regard to what somebody owns, when he or she acquires an asset, the deposit that must be paid and the restrictions in respect of getting full value as he or she must drive the exact amount that was stated in the PCP in the first place because going above or below will mean getting much less value for the investment. At the end of the day, it is not the person's property under a PCP. In these particular cases, a serious amount of consumer protection work must be undertaken. If we look at some credit union headline rates at present, the 12% cap is a very distant memory in terms of the value to be had.