New lending system ‘will help credit unions take on the banks’
The majority of people believe the exits of KBC and Ulster Bank will negatively impact them, a survey has found.
The poll, by Amárach Research for Metamo, a joint venture between financial services firm Fexco and Ireland’s 16 largest credit unions, shows 82pc of consumers feel less competition in the banking sector is a bad thing.
A quarter of those surveyed are considering opening a credit union account, while 44pc of people that have credit unions accounts plan to use them more.
“Credit unions are a vital and trusted pillar of their communities, but many are challenged to bridge the gap to compete with other financial services institutions,” said Alan Kelly, chief executive of Metamo.
“Unsurprisingly, the recent exit of retail banks is something that consumers are worried about. Credit unions have an opportunity to play a greater role in the banking ecosystem, however, they must innovate to meet consumer needs.”
Ulster Bank is set to close all its remaining branches in the Republic of Ireland on April 21, following Permanent TSB’s rebranding of 25 former Ulster Bank branches.
The day-to-day management of KBC Bank accounts transferred to Bank of Ireland last month. The lender is expected to close its main Dublin hub at the end of August.
As of the end of February, there were almost 230,000 current accounts still open in Ulster Bank and KBC Bank, with more than 880,000 closed in the last year.
A discussion on the future of credit unions takes place today at an event organised by Metamo, which will look at using technology to reduce the time it takes to apply for and be granted a loan.
Metamo’s Quantum AI lending system can grant approvals in as little as three minutes, the organisation claims, allowing borrowers to get loan approval remotely, by phone or in person.
Mr Kelly said the new technology “will enable credit unions to compete with larger service providers such as banks, while retaining the personal element that is such a crucial component of the trust members have”.
Minister of State for Financial Services Jennifer Carroll McNeill said she wants to help credit unions “to compete, grow and thrive in what has become a fast-paced and highly competitive market”.