Mary Mitchell O'Connor (Dún Laoghaire, Fine Gael) | Oireachtas source

The credit union movement was founded more than 50 years ago and it is just as relevant today as it was to its founding members, particularly when considered against a backdrop of banks closing branches and limiting or increasing the cost of their services. While it is widely accepted that better supervision and regulation of all financial institutions, including credit unions, is needed, I am concerned about the impact of the commencement of the remaining sections of the Credit Union and Co-operation with Overseas Regulators Act 2012.

I recently met representatives of a number of credit unions from my constituency and elsewhere who briefed me on the range of services and products that are available or ready to come on stream. A common perception of credit unions is that they only provide basic services, such as small loans for household appliances and holidays or to meet communion and confirmation expenses. This could not be further from the truth. While credit unions are firmly grounded in an ethos of volunteerism and service to their community, they are professionally run financial institutions with electronic and online services and are capable of providing a real alternative to the banking system that let us down so badly. They also contrast starkly with the big banks, which are becoming increasingly automated and, in many cases, unwilling to give their customers the one-to-one service they want.

It is clear that credit unions have implemented in good faith the findings of the report of the Commission on Credit Unions. They have emphasised to me that one key aspect of the report is missing, namely, the development of permissive regulation that would allow credit unions to develop what they believe to be a sound business model. Furthermore, they are calling on the Central Bank to approve the request by credit unions to provide payment account services and debit cards and to increase the limit applied to loans with a term of more than ten years to 20% of total loans and loans with a term of between five and ten years to 30% of total loans. They are also calling on the Central Bank to revert to the 1997 limits on savings which a member can hold with a credit union.

I understand it is the Minister's intention to commence the remaining section of the Act on 31 December. I encourage her and her officials to carefully consider the concerns that will be raised and the recommendations that will be made at tomorrow's meeting with credit union representatives. I recognise that a number of points of concern made by credit unions are a matter for the Registrar of Credit Unions and ask the Minister to prioritise communicating these concerns to the registrar. It should be also clarified that more than 99% of credit union members will not be affected by the €100,000 cap on savings. However, credit union members who want to lodge more than €100,000, for example, members of the Garda, ESB and teacher credit unions, should be able to do so. I look forward to the Minister's contribution.

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