Dáil Éireann Debate, Thursday - 13 July 2017
153. Deputy Michael McGrath asked the Minister for Finance the number of credit unions which have been approved and declined respectively for additional services in the past five years; the number of applications ongoing; and the length of time it takes on average from preliminary application stage to full approval. [33788/17]
View answerThe Credit Union Act 1997 (the 1997 Act) and the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016 (which set out services exempt from additional services regulations) set out the services that a credit union may provide to its members. These include loans; savings; account access by phone; account access by internet; third party payments (including EFT); ATM services; bureau de change; certain insurance services on an agency basis; group health insurance; bill payment; money transfers; standing orders; direct debits; financial counselling; PRSAs on an introduction basis and insurance on an introduction basis.
Where a credit union wishes to provide services to its members, other than those services that are provided for under the 1997 Act, an application may be made to the Central Bank for approval to provide such additional services in accordance with the provisions set out in sections 48-51 of the 1997 Act.
As set out in communications to the sector the Central Bank is, in principle, supportive of credit unions developing additional services and will consider proposals from credit unions on new additional services they wish to provide to members, where the credit union can demonstrate that:
- the proposed additional service is supported by a robust business case;
- the proposed additional service is not contrary to financial services legislation;
- the board of directors has a sound appreciation of the nature of the additional service proposed and is fully informed of the strategic, governance, risk management, operational, financial and legal implications involved; and
- systems and controls are in place to ensure any risks involved in the provision of the additional service are managed and mitigated.
I have been informed by the Central Bank that in the last five years, 11 applications for additional services have been approved and no application has been declined. The majority of these applications have related to the Central Bank approved suite of additional services known as a Member Personal Current Account Service (MPCAS) under the Additional Services Framework set out in sections 48-52 of the Credit Union Act, 1997.
This service, provides for credit unions to offer debit cards, overdrafts and a full range of payment services within an appropriate risk framework.
Since the Central Bank approved the MPCAS suite of additional services there has been strong interest in this service and the Central Bank is currently processing a significant number of applications, which are at different stages of assessment but the majority are currently at an advanced stage. Details and application forms for the MPCAS service are available on the Central Bank website.
I have been further informed by the Central Bank that the timescale from preliminary application stage to full approval depends on the quality of information provided. Where the application form has been fully completed and contains or includes all of the information requested, the Central Bank endeavours to turn around the application as quickly as possible.
