Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

My role as Minister for Finance is to ensure that the legal framework for credit unions is appropriate for the effective operation and supervision of credit unions. The Registrar of Credit Unions at the Central Bank of Ireland is the independent regulator for credit unions. Within her independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability and to protect the savings of credit union members.

The  Credit Union Act 1997 Act and related statutory instruments set out the services that a credit union may provide to its members. Where a credit union wishes to provide services to its members in addition to the services that are provided for under the 1997 Act, an application may be made to the Central Bank for approval to provide such additional services in accordance with the provisions set out in sections 48 to 52 of the 1997 Act.

I have been informed by the Central Bank that it is supportive of credit unions developing additional services and it has indicated to credit unions that where they are considering offering debit card services to their members, they should, in the first instance, contact the Registry of Credit Unions to inform it of any such proposals.Furthermore, in respect of debit cards, the Central Bank states that it has been clear in its engagement with credit unions and other stakeholders who are seeking to offer this service that it must be supported by the appropriate payment account service. Consequently, using the additional services framework in sections 48 to 52 of the 1997 Act, the Central Bank has defined and described a Member Personal Current Account Service, MPCAS. This service, which was recently approved for six applicant credit unions, provides for credit unions to offer debit cards, overdrafts and a full range of payment services within an appropriate risk framework.

The Central Bank will publish details of MPCAS and the approval process, along with details of the application requirements and related guidance, over the coming weeks.

Additional information not given on the floor of the House.

The Central Bank expects to hear from eligible credit unions wishing to apply for this additional service over the coming months.Initially, credit unions that have close to or in excess of €75 million in total assets are eligible to apply.There are about 65 credit unions in this cohort which collectively have €8 billion in assets. Depending on their success in collaborating to implement a viable business, it is possible to envisage smaller credit unions being able to offer the service in time. This approval provides for debit card provision amongst other key features.

MPCAS provides for shared service facilities, which approved credit unions will use to develop and implement services in a standardised way from both a technological and operational perspective. This represents a significant and positive development for many credit unions who wish to provide current account services and payment instruments such as debit cards to their members.The Government recognises the important role of credit unions as a volunteer co-operative movement in this country. However, the Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall and we are determined to support a strengthened and growing credit union movement.

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