Borrowers flock to credit unions
If you thought Irish credit unions, with all their reported financial difficulties and ongoing consolidation, are struggling to attract personal loan business from the banks, think again.
A recent survey by the Competition and Consumer Protection Commission revealed that just 9pc of adults took out a personal loan over the last year and, of those who did, 60pc obtained theirs from a credit union.
The study also reveals that consumers aged between 25 and 34 were the most likely to take out a loan in the last 12 months (16pc), with car finance (41pc), holidays (25pc) and home improvements (20pc) as the top three reasons.
The average loan amount was just under €5,000, typically paid back over three years.
According to the Irish League of Credit unions, the average standard loan interest rate across its member institutions is 10.47pc, but they offer competitive rates for specific-purpose loans, with 7.51pc average rate for car loans, a 7.25pc average rate for home improvement loans and a 6.55pc average rate for education loans.
Of course, you need to be a member to avail of these rates, but some credit unions, such as Dundalk Credit Union, will ask that you save with them for just three months before you can be considered for a loan.