Editorial: Credit unions must be allowed to fulfil vital role
The credit union movement was set up to provide small loans to members of the community for things like paying school and college fees, buying a new kitchen or even covering the cost of a family funeral. It is regrettable, therefore, that the Central Bank has ordered 200 (out of a total of 392) to limit lending, a restriction that credit unions believe may benefit the banks or drive some of its customers into the unsavoury arms of moneylenders.
The credit union regulator in the Central Bank, Sharon Donnery, is rightly worried that arrears represent more than 30pc of the entire loan book in 47 credit unions, and that 20pc of the loan book of the credit union movement is in arrears.
There is no doubt that some credit unions did get caught up in the 'boom', lending to developers or allowing members to over-extend themselves with holiday homes and other luxuries they may now not be able to afford.