Peadar Tóibín
Question:375. Deputy Peadar Tóibín asked the Minister for Finance if he and his officials have considered the introduction of an additional public banking pillar; and if he will make a statement on the matter. [28666/15]
View answerTuesday, 22 September 2015
Questions (375)
Written answers
I assume the Deputy is referring to the concept of local public banking. The focus of such banks is on the needs of residents and SMEs within their own geographic catchment area. Local public banking could have the potential to complement Government policy in a range of areas such as improving competition in the banking market, augmenting competition and innovation in the SME finance market and regional development.
The Government remains committed to the SME sector and sees it as the key engine of ongoing economic growth. As the Deputy will be aware, the Government has to date delivered a number of initiatives that increase access to finance for SMEs such as the Strategic Banking Corporation of Ireland (SBCI), the Supporting SMEs Online Tool, the Credit Guarantee Scheme, Microenterprise Loan Fund, Local Enterprise Offices and the Credit Review Office.
The business model of local public banks is similar to that of the SBCI in that rather than focusing on profit maximisation, they seek to enhance the availability of finance to SMEs in their catchment areas. It is encouraging to note that the most recently published lending figures for the SBCI show that 85% of lending to date has been to regionally based SMEs. Other institutions operating in the Irish credit market such as credit unions are not profit maximising entities but have a key role to play in providing access to credit and other important services in local communities throughout the country.
Officials from my Department are considering proposals on local public banking and its potential for Ireland. They have been considering how a local public banking concept, with a focus on supporting SMEs, could complement initiatives already in existence.