NEW legislation will help credit unions to offer a national mortgage rate and make them an even more attractive alternative to banks, an Ireland South MEP said.
Fianna Fáil MEP Billy Kelleher is chair of the European Parliament’s Credit Union Interest Group and was speaking ahead of the first phase of implementation of the 2023 Credit Union (Amendment) Act, the first piece of Credit Union-specific legislation in over 12 years. The second phase is expected in April.
Some Credit Unions are already offering mortgages but the new legislation will enable non-mortgage lending credit unions to refer their members to other credit unions.
‘We all know how important credit unions have been in terms of supporting families with personal, car, holiday and other loans.
Now, with the enactment of this Act, we will see our credit unions be able to greatly expand their offering in terms of mortgages,’ said Mr Kelleher.
‘The law will allow the credit union movement to collaborate nationally on mortgages by developing and marketing a national brand and a national mortgage rate.’
Mr Kelleher said Ireland’s traditional banking sector is too small and lack of competition pushes interest rates up.
Member unions of the Irish League of Credit Union hold more than €310m in savings alone.
Central Bank of Ireland regulations impose a cap on lending relative to a credit union’s assets.
Mr Kelleher called on the Central Bank to review these lending limits and consider ‘whether raising these limits could stimulate more competition in the market’.
