Joanna Tuffy (Dublin Mid West, Labour)
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Question 107: To ask the Minister for Finance his views on whether, with respect to proposed reforms of the model of financial regulation here, it is appropriate to include in these reforms changes to the regulation of credit unions here or if he plans to deal with the issue of credit union regulation separately as part of a more broad based reform agenda for the credit union sector; his further views on the maintenance of the current regulatory arrangements for credit unions until such time as amendment to the Credit Union Act 1997 is deemed appropriate; and if he will make a statement on the matter. [37696/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The Credit Union Act 1997 provides the legal framework for the regulation of credit unions. The Act was designed to provide the credit union movement with a regulatory structure that reflects and promotes the particular ethos and philosophy of the credit union movement, its strong tradition of volunteer service and the core objective of providing opportunities for saving and lending for members of credit unions. The approach to regulation embodied in the Credit Union Act 1997 has served the credit union movement well by providing clarity and certainty to individual credit unions, their Directors and members. It has helped support the continued stability of the credit union movement and safeguard the members' savings during a period of rapid growth.

The future shape and operation of the legislative and regulatory framework will strongly influence the evolution of the credit union model. The question is how best to integrate that framework with the strategic development of the credit union movement in a manner which remains fully consistent with financial stability and long-term sustainability.

When, in June 2009, I announced major reform of the institutional structures for regulation of financial services in Ireland, I stated that no change is proposed to the current role and responsibilities of the Registrar of Credit Unions and that regulation of credit unions will remain within the Central Bank of Ireland structure.

However, the need for some modernisation of the legislative and regulatory framework for credit unions has become evident over time and it is clear therefore that the current legislative framework needs reform. I have asked the Chair of the Financial Regulator to initiate a review of credit unions which it is hoped will make an important contribution to identifying the appropriate way forward.

Martin Ferris (Kerry North, Sinn Fein)
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Question 108: To ask the Minister for Finance if his attention has been drawn to the practice entitled pay-day lending which is in use here by a number of money lenders; the implications of such practice on persons who avail of it; and the action which will be taken to eliminate this practice. [37610/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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From my inquiries with the Financial Regulator, the authority for licensing moneylenders, I understand that it has not issued any licences authorising moneylenders to provide pay-day loans, i.e. short-term loans intended to cover a borrower's expenses until her/his next pay-day, with the initial loan running for approximately one month. Anyone who becomes aware of such non-licensed money lending activity should bring it to the immediate attention of the Garda Síochána.

The Financial Regulator provides information about the different forms of credit available to consumers, including credit cards, overdrafts, hire purchase, personal loans and money lending and recommends that consumers take on the right type of credit for the right purpose. It also recommends a number of steps that borrowers should take including shopping around for the cheapest loan, reading all loan agreements, reviewing their debts from time to time and not taking on more debt than they can afford. I strongly endorse the recommendations of the Financial Regulator and urge consumers to avail of the detailed information on borrowing money and getting credit which is available through its publications, help-line (Lo call 1890 77 77 77) and website http://www.itsyourmoney.ie.

Finally, the Deputy may wish to note that my colleague, the Minister for Social and Family Affairs, provides a non-profit public service counselling service through the Money Advice and Budgeting Service (MABS) at her Department. This is a national, free, confidential and independent service for people in debt or in danger of getting into debt. The Irish Banking Federation (IBF) and MABS recently agreed an Operational Protocol on consumer debt. The Operational Protocol will enable MABS and the IBF to continue to work together effectively when dealing with debt problems of personal debtors who approach the MABS Service for assistance.