Tom Fleming (Kerry South, Independent)
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167. To ask the Minister for Finance if he will facilitate an initiative enabling an alliance of post offices and credit unions to grant loans to the general public, as together they could provide special social and community focused banking and this would be of mutual benefit to the existence of both services and it would help revitalise rural towns and villages; and if he will make a statement on the matter. [1656/15]

Michael Noonan (Limerick City, Fine Gael)
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The credit union sector plays an important role in providing financial services nationally, but in doing so must retain the responsibility of ensuring members' funds are not put at undue risk.

While the Department receives many proposals on various issues, my Department received a proposal in August 2014 outlining a plan to establish and operate joint initiatives between participating Limerick County Credit Unions and An Post. This plan involves a Pilot Project that would see the channelling of some of An Post services through credit unions and also looks at the prospect of An Post providing some credit union services.

I am always open to considering proposals in relation to credit unions, particularly those that would see the development of the credit union business model and an increase in income for the sector. Having read this proposal I believe there is some merit in it. However, it must be stressed that the proposal is at a very early stage of development and would require additional work, as identified in the paper by the proposers, before it can be progressed further. 

While officials from my Department met with one of the proposers of this plan on the 29 August 2014 to discuss its merits, such a proposal would require agreement from all stakeholders before a pilot project could be rolled out. A further meeting is scheduled with the proposer in the coming weeks to further discuss the matter.

The proposal was also forwarded to the Central Bank, the Irish League of Credit Unions, the Credit Union Development Association and the Credit Union Restructuring Board (ReBo). I have been informed by the Central Bank  that they met with credit union representatives involved in the proposal in October 2014 and have provided feedback on the proposal. The feedback covered matters for consideration in further developing the proposal, including areas of the financial services legislation that apply to credit unions, such as requirements whereby individual credit unions can only provide services to their members rather than to the general public. The Central Bank have also indicated that they are available for further meetings with the relevant parties as appropriate.  

The Registrar of Credit Unions at the Central Bank is responsible for the regulation of credit unions and as such, any proposal in relation to credit unions would be subject to regulatory approval by the Regulator.