Turmoil in the banking sector has emphasised the need for long overdue legislation to support credit unions in Cork and beyond, according to a Cork TD.
Social Democrats leader Deputy Holly Cairns has said she could not have made it through college without support from credit unions, the backbone of local communities.
New legislation currently making its way through the Dáil aims to expand the services of credit unions, something Ms Cairns has welcomed.
“Credit Unions offer an incredibly important service,” the Cork TD told The Echo. “Ireland has one of the highest percentages of population who are members of Credit Unions globally. They have played a vital role in many Cork people’s lives for years.
"Their continued success is shown in the Cork Credit Unions, a collaborative group of 30 Credit Unions.”
Ms Cairns said she knows from conversations she has had with individuals, community groups, and farming organisations, “the important role credit unions play in providing people with financial services and loans, especially when the commercial banks are denying the same people these facilities".
"At a time when banks are leaving the Irish market and the remaining banks are closing branches, credit unions have never been so relevant.
“Also, it is reassuring that in a credit union you will be guaranteed to meet a staff member and not be directed to a machine," she added.
"I cannot stress how important that is for older people who are less comfortable with technology, but it also applies to disabled people or people with English as a second language.
“Unfortunately, our current legal and regulatory framework fails to appreciate credit unions' function as co-operatives and the importance of the common bond. Instead, they have excessive limits on their services and potential."
Ms Cairns stated further that credit unions are actively increasing their provision of finance in the areas of SME business lending and mortgages. "Many are ready to provide much needed services to local enterprises, family businesses, and to help address our housing crisis, and in doing so would also increase their viability and benefit members," she explained.
"It is a win-win situation. However, financial regulations are putting anti-business controls in place on how much credit unions can lend for these purposes," she added.
“New legislation, that is currently making its way through the Dáil, aims to expand the services of credit unions to put them on a sustainable footing for the future. This is very welcome but long overdue - the Irish League of Credit Unions and others have been calling for reforms for years now.
"However, the legislation does not go far enough to ensure that the regulation of credit unions appreciates their role in communities and allows them greater flexibility to provide loans," Ms Cairs said.
“This is an area in which the credit union movement has been ahead of the government and they are ready for the new changes.
"We need only look to Bantry Credit Union, which bought the former Bank of Ireland building and has installed an ATM to see the type of vibrancy and innovation I am talking about."