Patricia Ryan (Kildare South, Sinn Fein) | Oireachtas source

I welcome the opportunity to speak on the future of banking in Ireland. This conversation is long overdue. The withdrawal of KBC and Ulster Bank from the Irish market was recently announced. In March, we had the announcement that 103 Bank of Ireland branches across this island will close. The bank is closing one third of its branches, including those in Kilcullen and Monasterevin in my constituency of South Kildare. The announcement was not surprising, but it was very disappointing. It was not surprising because the banks have been pushing people away from their branches for years. They have consistently reduced front-facing staff to turn people away from branches. These bank closures affect the most vulnerable in society, such as older people and families on low incomes. They also affect struggling small business owners. These people, along with rural dwellers, will have the greatest difficulty in adapting, due to the poor availability of affordable broadband.

Sinn Féin has consistently called for the establishment of a forum on the future of banking. Such a forum would enable industry experts, stakeholders, and customer representatives to consider the state of our banking system and plan a more effective future. We must be more proactive and less reactive. We must strengthen the powers of credit unions. I am a proud member of a credit union. They do amazing work on a voluntary basis in every community across this island. We need to give them and post offices a greater role in our banking system. They are rooted in their communities and are best placed to help the local areas of which they are an integral part. Credit unions should be given limited capacity to provide mortgages. They should also play a greater role in funding the building of social housing. We should create a mechanism by which credit unions could invest in social housing. Credit unions could play a very important role in helping the country to meet its climate change targets by providing funding for a national retrofitting programme.

We need a strong banking force to counteract the indifference of the current commercial banks to their customers. Sinn Féin believes this should be a community banking model which can best fill this role and has published a policy document in this regard. The issue of public banking has been on our agenda for several years. The Minister may refer to the Indecon report of 2019 and how it dismissed the need for a public banking system because commercial banks were fulfilling the role but that is no longer the case. There have been fundamental changes in the market with the withdrawal of Ulster Bank and KBC Bank, as well as the Bank of Ireland branch closures.

The Government must engage with credit unions and post offices to explore the possibility of utilising their existing infrastructure for a new public banking system. Colleagues have referred to the Kiwibank model in New Zealand, where banks and post offices share the same building. It is an example of how existing infrastructure can be used for banking purposes. The Sparkasse model has operated in Germany for 200 years as an interconnected network of 390 individual local authority-owned banks that, between them, operate 12,000 branches. It offers long-term SME loans at a 3% interest rate, while its best mortgage rate for home buyers is 1.1% fixed for ten years. We need banks that operate for the benefit of their customers rather than feeding off their misery.

Finally, I will briefly comment on the withdrawal of Provident, a moneylender, from the Irish market. In a rare parting gift, the lender has stated it is writing off any remaining debt owed by its customers. That is to be welcomed but I worry about the next time its clients need a loan. A solution must be found so that they do not have to resort to unsavoury characters in order to pay for first communions, or confirmations or, indeed, if a household appliance such as a fridge or an oven breaks down. Community banking is that solution.

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