Eamonn Maloney (Dublin South West, Labour) | Oireachtas source

We are very fortunate to have a very strong credit union tradition. Credit unions are located throughout the country, both in urban centres and elsewhere. The Irish have a very strong attachment to the movement and my constituency is no exception.

I recently met representatives of four local credit union branches, namely Kilnamanagh Credit Union, Firhouse Credit Union, Tallaght and District Credit Union and Tallaght West Credit Union. They are very dedicated people who provide an excellent service. The credit union is traditionally described as the bank of the working classes. The movement has gone from strength to strength over the years and it has been very beneficial and sympathetic in the communities in which its branches operate. However, the credit union movement has not escaped the fallout of the collapse of the Celtic tiger. Recent legislation on credit unions has obviously resulted in changes. The movement and local branches argue that they are not happy with some of the restrictions placed on them. The credit union officers I met recently are perplexed and, in some cases, angry, especially consequent to recent comments by the Minister for Finance to the effect that they should start lending. This is exactly what the credit union movement and its local branches want to do. I am informed they would be only too happy to lend to their members but are precluded from doing so due to the restrictions imposed by the Central Bank under recent legislation.

The Central Bank has imposed lending restrictions on a large number of credit unions. In some cases, this is for a very good reason. I am not here to argue about that. Restrictions include a maximum loan to which a member is entitled and a maximum in loans that can be issued in a month, for example, €100,000. In many cases, there is a complete ban on commercial business loans. The latter does not apply to all but applies in most cases. This is a real issue for branches.

When one considers that the credit unions in this jurisdiction have in excess of €7 billion in funds, one can understand the desire of local branches to provide funding to local SMEs. Given the current climate, in which the economy is growing, albeit not fast enough for all of us, there is a desire to lend. Credit unions are prepared to step into this area, albeit with certain restrictions. The movement and I are asking the Minister to examine this matter and allow SMEs to avail of credit union loans.

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