Blog: Reform needed to enhance potential of credit unions, says Hanley – Galway Advertiser

Cllr Owen Hanley says Government reform is needed to enhance the potential of credit unions.

Credit Unions are vital according to Cllr Hanley. “Current financial regulations fail to appreciate their community function and are limiting credit union services and potential,” he says.

“While the Government has promised reform, it has yet to happen. When you visit a credit union, you will be guaranteed to meet a staff member and not be directed to a machine. This human interaction is incredibly important for people not comfortable with technology or for those who just need to talk a financial issue through. It is about accessibility and inclusion.”

The Galway City East councillor adds the physical presence of a branch in a community or town is important to help people use the services and to keep our communities alive.

“Credit Unions provide loans and flexible services to many people and families refused by commercial banks,” he says.

“There are many farmers and small businesses in particular who are only able to stay operating because of the credit union. The same can be said of students and other groups. Only recently, several credit unions have developed an initiative called Cultivate that provides loans built specifically around the growing needs of farming members. This is the type of member-focused service that only credit unions offer based on understanding issues on the ground.”

“Credit unions are also competitive with commercial banks for everyday financial needs with current accounts. Members can use these for normal banking, for direct debits, and for Apple and Google Pay. Credit unions are ready to accommodate customers of banks which are closing. But under current financial regulations, they are being limited in the services they can offer, especially around mortgages and lending to small and medium enterprises.

“Financial institutions must lend to remain viable. However, credit unions are being restricted in areas commercial banks are not. Rules brought in during the financial crisis have not been changed. Until the Government reforms this area, it will affect the ability of credit unions to succeed.”

Cllr Hanley wants the Government to value credit unions.

“While we all understand the role of financial regulation the Minister for Finance must ensure that the Central Bank oversees credit unions in an appropriate way that recognises them as volunteer-led organisations and community banking providers,” Cllr Hanley says.

“I find it very frustrating that Ministers and Government TDs all stood up speaking in support of credit unions but the necessary changes are not being made. credit unions across Galway offer more than financial services, they are a lifeline for many families, they are inclusive and accessible, and they sponsor events and good causes.

“Our communities deeply value these member-focused organisations. It is long overdue that the Government does the same.”

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