Regulations ‘threaten the future of Credit Union movement’

THE Mayor of Kilkenny is concerned that the lending restrictions imposed on Credit Unions is going to result in further job losses and force families to resort to illegal money lenders.

THE Mayor of Kilkenny is concerned that the lending restrictions imposed on Credit Unions is going to result in further job losses and force families to resort to illegal money lenders.

Mayor David Fitzgerald said the restriction imposed by the Financial Regulator on Credit Unions has the potential to undermine the whole movement. “The Credit Union is being hindered by caps that have been put on the monthly lending totals. These new lending restrictions are cutting off access to credit for education, home repairs and even family expenses in some cases,” Mayor Fitzgerald said.

“It seems unfair that small borrowers who didn’t cause the financial collapse are now suffering because of the failure of successive financial regulators. This will cost jobs and cause hardship for families”

The number of checks and balances that have been put in place have also turned a huge number of people away from the Credit Union, the mayor said.

He said he was aware of at least one person who had a perfect credit history with the Credit Union who couldn’t secure a loan due to the level of documentation required. When he made enquiries seeking a loan, he was asked to produce bank statements and tax clearance certificates before he could proceed with the request. The request didn’t proceed due to the level of documentation required, the mayor said, adding that this level of documentation and information requested was far higher than it was in the past.

Mayor Fitzgerald said he was a huge supporter of the Credit Union movement and that St Canice’s Credit Union was a model for other Credit Unions to copy.

“The Credit Union are the only lending institution that has supported people during the credit crunch,” he added.