Kilkenny's St Canice's Credit Union in good health, but challenges loom in 2022

St Canice’s Credit Union looks to be in good health and auditors have signed off on EOY statements, with all motions voted through and adopted with no issues at the recent AGM. Looking ahead, a number of challenges will present in the coming year.

One obvious point of discussion is that there is to be no dividend or loan rebate for members, and barring a major swing in consumer behaviour and the global economy, that may be unlikely to change in a hurry. If the current trend prevails and people stay focused on saving rather than spending, and members do not borrow, income is going to decline.

The shift of increasing personal savings that took off in the early days of the pandemic has continued, and the appetite to spend is not yet there.

Significant cost of living increases are a factor in this. House prices also continue to climb, while there has been an unprecedented rise in the cost of used cars. There does still seem to be demand for trades work on private houses, such as plumbing, extensions and minor renovations.

What could prove the difference is a significant pandemic breakthrough; a major lifting of travel restrictions and a boom in foreign holidays and big events such as weddings, would would likely see borrowers return.

Last year, there was hope that the arrival of vaccines would light this spark, but the new variants scuppered that. The good news is that airlines are already reporting confidence in travel is soaring this year.

Meanwhile, certainty around how businesses will be affected or how normality might return to certain sectors would likely see activity quickly increase. While many have availed of government grants and supports to make moderations, others could be planning more substantial changes, for which borrowing would be a necessity.

What is clear is that if the current low lending scenario continues, it will present a problem down the line. It will require careful stewardship by those in charge as well as innovation, which is already being seen.

The Credit Union Board is making strides to modernise and upgrade services to cater to a younger, digital generation, and has widened the scope of lending possiblities both in terms of ease of application and the variety of loans on offer. Crucially, success will also require buy-in and support from the members in availing of these services.