Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I can advise the Deputy that my Department is aware of the paper from the Centre for Community Finance Europe Limited, CFCFE, on Irish credit union business models which was commissioned by the credit unions that helped found the CFCFE, including a number of Irish credit unions. The paper argues that the traditional, simple business model of credit unions in Ireland needs to change if they wish to succeed into the future. It is fair to say that there is significant diversity in many aspects of the business model for credit unions which can be large or small, rural or urban, industrial or regional, and can have business models adapted to their particular membership base. The Government understands the challenges this raises and that flexibility and proportionality is required both in policy and regulation.

Credit unions have a unique role as a grassroots, not-for-profit, volunteer-based movement in our communities. They have a key role to play in providing access to credit and other important services in local communities. Indeed, the CFCFE paper acknowledges the strength of the credit union brand in Ireland. The paper's findings build on previous reports for Government by the Commission on Credit Unions in 2012 and the Credit Union Advisory Committee, CUAC, in 2016 and a recent report from the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach.

Business model development is one of the key issues that the implementation group which was set up to oversee the implementation of the CUAC’s recommendations is looking at and work is ongoing. The CUAC will also focus on this issue in 2018 and recently invited the CFCFE to meet it to discuss its paper. My Department continues to support credit union initiatives to develop services.  In certain circumstances, the provision of new services must be approved, prior to their introduction, by the registrar of credit unions at the Central Bank, which acts as the independent regulator for credit unions.

The Government's priorities remain the protection of members' savings and the financial stability of credit unions and the sector overall, and I am determined to continue to support a strengthened and growing credit union movement into the future.

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