Written answers

Tuesday, 20 March 2007

Department of Finance

Proposed Legislation

11:00 pm

Photo of Aengus Ó SnodaighAengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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Question 134: To ask the Minister for Finance his views on legislating for the right to a bank account, as has been done in other states, to enable people without a bank account to open an account at a financial institution of their choice. [10185/07]

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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The banking industry has proposed the development of a universal bank account enabling all citizens to make and receive payments electronically — whether in the form of salary, benefit or welfare. The Deputy may wish to note that there are a number of important issues to be considered in progressing such a proposal such as the fees to be associated, who would have right of access to such an account and also the underlying need for such a product. For example, at the National Payments Conference in December 2006, hosted jointly by the Department of the Taoiseach and the Irish Payments Services Organisation, data was presented which suggested that this is a less widespread issue than has been thought hitherto. More detailed study is therefore necessary in advance of the formulation of any policy initiative in this area.

It must also be remembered that the credit union movement has been a key provider of savings and loans since its inception and has a particular role to play in supporting savings by persons on low incomes.

My responsibility as Minister for Finance is to bring forward proposals for a legislative framework for the regulation of the financial services sector from a prudential, systemic and consumer protection perspective. In general the operational responsibility for implementation of that framework lies with the Financial Regulator. As far as I am aware the legislative and regulatory framework provides no obstacle to access. There are 7,000 or so financial services providers authorised by the Financial Regulator and the range and scope of the services they provide is primarily a commercial decision in which neither the Financial Regulator nor I have any direct function.

As part of its consumer mandate the Financial Regulator has taken a number of specific initiatives to help consumers in the framework of the Financial Regulator's "It's Your Money" campaign. These have involved publishing consumer guides and cost surveys on credit and other financial products, and fact sheets, including a fact sheet entitled "How to Open a Bank or Building Society Account" all of which are intended to assist consumers in making the most appropriate financial decisions. The Financial Regulator has commissioned independent research into this matter with a view to further possible initiatives or policy proposals to address any problems identified. This research includes the report entitled 'Financial Exclusion in Ireland — An Explanatory Study and Policy Review' which was launched by the Financial Regulator on 11 December 2006. The Financial Regulator has also included in its Consumer Protection Code a requirement that any measures adopted in relation to identification of customers should not deny a person access to financial services solely on the grounds that they do not possess certain specified identification documentation.

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