Peadar Tóibín
Question:105. Deputy Peadar Tóibín asked the Minister for Finance if his Department has undertaken any study to determine the merit of a public banking system. [42635/23]
View answerThursday, 5 October 2023
Questions (105)
Written answers
I wish to advise the Deputy that the Department of Finance published a report in December 2019 by Indecon Consulting on an Evaluation of the Concept of Community Banking in Ireland. This report followed a previous paper on Local Public Banking published by my Department in 2018.
The Indecon report concluded that there is no business case for the State to establish a community banking system in Ireland; supporting the outcome of the previous report on Local Public Banking. The report notes that the Exchequer costs and risks involved would not be justified. The report also notes concerns over the ability of a new State owned bank to provide effective competition.
The Indecon Report looked at the credit union sector, and concluded that Credit Unions are considered to be a ‘community bank’. Credit Unions are a key provider of financial services throughout Ireland, and are continuing to expand the range of services they provide.
As the Deputy will be aware, the Department of Finance also published a broad-ranging review of the retail banking sector in November last year. Section 5 examines competition in the Irish retail banking market and considers the case for the establishment of a community banking system.
Recommendation 5.2 of this review stated that the Department of Finance should support the Credit Union sector to safely and sustainably provide a universal product offering.
Evidence of the Government’s support for the Credit Union movement growing as a key provider of community banking can be seen in the Credit Union Amendment Bill 2022 which was published in November 2022.
This legislation will allow the Credit Union movement to provide a broader range of services to its customers. The Bill completed the legislative process in the Seanad in December last year and was introduced in the Dail in March 2023.