Business Irish

Thursday 21 September 2017

Credit unions aggressively pursue debtors with 160 court judgments

Lenders secure €3.7m of rulings this year alone as they struggle to balance books

Peter Flanagan

Peter Flanagan

CREDIT unions are now among the most aggressive businesses to pursue debtors through the courts.

According to data from business information firm Vision-Net, credit unions have so far secured some 160 judgments worth about €3.7m this year.

That rate is increasing, with 19 judgments worth €1.7m hammered out in March alone – a rise of more than a third on February.

At the current pace, credit unions will secure judgments worth close to €16m against debtors by the end of the year.

Some credit unions are exposed after being burned for €14bn by the liquidation of the former Anglo Irish bank. Taoiseach Enda Kenny has insisted that no depositors will be affected in this regard, as there is a compensation fund available.

But credit unions are often having to pursue their debtors more aggressively to balance their books.

In March the average judgment value increased sharply to €128,000.

The biggest single judgment has been for about three-quarters of a million euro, while Charleville credit union in Cork has secured a judgment of €521,000.

Vision-Net's managing director Christine Cullen said credit unions were well known for pursuing debts through the courts.

'Force'

"Credit unions have a long history in how they handle defaulters and they would be among the top plaintiffs since 2008.

"Interestingly, there have been few signs of forbearance within the industry, especially considering the new personal insolvency laws will be coming into force shortly.

"Many of those loans would be unsecured, and we have noticed the value of the amounts owed have increased steadily," she added.

Unlike the banks, credit unions have traditionally been used for relatively small loans for holidays and cars and such, but during the boom Ms Cullen said it appeared the value of loans doled out increased sharply.

"One of the notable things about a credit union is that people are in general much more likely to make an effort to pay its loans than other debts such as a credit card.

"They play a vital role in many communities and people tend to go the extra mile for them," she added.

In value terms, Roscrea Credit Union has gained the highest amount of judgments – worth €773,605 so far. The seventh biggest, meanwhile, is St Patricks, the ESB staff credit union in Dublin, with judgments secured worth €93,260.

Finglas Credit Union has secured 23 judgments so far in 2013, nearly three times as many as the next lender.

Irish Independent

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