Dáil debates

Thursday, 10 July 2014

Strategic Banking Corporation Bill 2014: Committee and Remaining Stages

 

3:10 pm

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I move amendment No. 3:

In page 6, line 1, after “on-lending” to insert “and directly”.
We are going to run out of time as a result of the guillotine the Minister has placed on us, so I will not take up much time on these amendments. Amendment No. 3 is a simple amendment. The purpose of the Bill is to allow for on-lending. I believe this should be accompanied by the possibility of direct lending. The Minister mentioned earlier that this will morph and grow into other things. While on-lending may be the way these companies or banks provide credit to SMEs and other sectors of society, it is not the only way. Direct lending also takes place and I believe this should be available as an option, if not for immediate purposes at least as it grows. For example, we should provide that we can lend directly to a certain sector or project, where the loan is not required to be on-lent through another financial institution.

In dealing with the issues of on-lending and direct lending, I am interested to hear the Minister's views in regard to the likes of Microfinance Ireland and where it sits within this Bill. This Bill is about small and medium enterprises, which includes microenterprises. We already have a company or agency set up to provide credit for microenterprises, at a lending rate of 9.5%. Is it envisaged that the SBCI would on-lend to that company, which would then lend it out at a cheaper rate or are the functions of that company going to be subsumed into this new company, which could therefore lend directly to the small and medium enterprises which have been refused credit from banks? Or, are we just going to get rid of Microfinance Ireland altogether. How is this going to pan out and is this going to change the structure there?

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