Assembly backs plans to expand credit union services
Credit unions in Northern Ireland last night moved a step closer to securing Government funding for service expansion to help plug large gaps in service left by wholesale bank branch closures across Northern Ireland.
A motion tabled by the Enterprise Trade & Investment Committee and debated at yesterday’s Plenary Session of the Northern Ireland Assembly at Stormont earned enthusiastic cross-party support. Further consideration on the allocation of funding to bring Northern Irelandinto line with the rest of the United Kingdom will require the immediate attention of the Executive to identify suitable income streams from which to finance the project.
Spokesperson for the Irish League of Credit Unions, Rosemary O’Doherty, speaking after yesterday’s decision, said:
“We are delighted with the tremendous backing given by members of the Assembly to credit unions and the work that they do. This is truly a vote of confidence in an organisation which is all about providing ordinary people with an extraordinary financial resource and service. The sole purpose of any credit union is to serve their members and, with a funding provision from the Assembly, we can expand our service here in Northern Ireland to include Current Accounts and card access, completing our offer of full viable, secure banking alternative for the communities that we serve.
“Funding is in place to make this happen in England, Scotland and Wales, but due to a disparity in legislation, financial support for such a scheme is not currently available here. In today’s challengingly austere economic climate we simply cannot afford for Northern Ireland to be left behind and we therefore look forward to meeting with the DETI Minister, Arlene Foster, and other relevant departments to progress today’s decision, and give practical support to credit unions in Northern Ireland, as Westminster and the Scottish and Welsh devolved governments have done.”
ILCU is asking for funding of just over £860,000 per year, over five years, to enable 75 credit unions to expand their services, allowing each to offer full current accounts with card access and thus provide a comprehensive alternative to managing money with the banks.
Bank restructuring has left many people without straightforward access to banking, unless they use online, which has had negative effects on many, including small businesses and older and more vulnerable people.
According to the Consumer Council 53 bank branches have closed in Northern Ireland in the past two years alone, with rural areas being hit especially hard, and there are now vast swathes of Northern Ireland with no access to bank branches.
Rosemary added: “We are ideally placed to fill the void left by bank branch closures by offering current accounts. This has been recognised in Great Britain where, despite only a 5% penetration of membership (compared with our 34%*), £38million in funding has been made available to credit unions to offset the start-up and maintenance costs of running current accounts.”
Credit Union membership in Northern Ireland has doubled in the last decade. Now 34% of the adult population is a member of a credit union.
A significant network of credit unions currently exists, spread throughout the province, with the ILCU’s 97 credit unions represented in 136 locations.
Credit unions are locally focused, not for profit organisations which exist for the benefit of members and are run for a social mission, rather than for the benefit of shareholders and the Stock Market.