Brian Stanley
Ceist:37 Deputy Brian Stanley asked the Minister for Finance the steps that will be taken to provide and protect banking infrastructure in rural and disadvantaged areas following downsizing by the banks. [25647/12]
Amharc ar fhreagraWednesday, 23 May 2012
Ceisteanna (38)
Freagraí scríofa
While I regret the closure of any bank branches, the Deputy will no doubt appreciate that the provision of services by banks, including the location of branches, is a commercial decision for the banks. The Deputy might wish to note that there is a provision in the Central Bank's Consumer Protection Code which imposes certain obligations on banks which have decided to close, merge or move a branch in a given location. The relevant provision states: Where a credit institution plans to close, merge or move a branch, it must notify the Central Bank immediately and provide at least two months notice to affected consumers to enable them to make alternative arrangements. The credit institution must ensure all business of the branch is properly completed prior to the closure, merger or move, or alternatively inform the consumer of how continuity of service will be provided. The wider community must be informed, in advance, through notification in the local press.
The advance notification requirement is designed to give existing consumers the necessary time to choose another credit institution. On the issue more generally, credit unions provide important financial services to members in rural and disadvantaged areas. The Government established the Commission on Credit Unions on 31 May 2011 to review the future of the credit union movement and make recommendations in relation to the most effective regulatory structure for credit union. The Commission presented its report to me on 31 March 2012 and published it on 18 April 2012.
The Commission recognised the important role that credit unions can play in promoting financial inclusion and engaging in social lending to members from disadvantaged backgrounds. The Report stated that the provision of basic payment accounts could be a good strategic fit for credit unions given their community roots and not-for-profit ethos and recommends that credit unions take a more prominent role in developing and maintaining social lending and social finance schemes.
A report setting out a Strategy for Financial Inclusion was published on my Department's website in June 2011. The main operational recommendation from the report was the proposed introduction of a "basic payment account". An implementation group, which is chaired by my Department, has been established to manage the implementation process and a basic payment account is expected to be rolled out in June 2012 on a pilot basis in three locations in the State. Following an analysis of the outcome of the pilot, it is expected that the basic payment account will be rolled out nationally in 2013.
It was noted in the Strategy for Financial Inclusion report that the post office network has the potential to play a key role in the delivery of basic payment accounts. However the delivery of a basic payment account by the post office network is contingent on suitable systems, operational, commercial and governance arrangements being in place to facilitate such a process. I am advised that this is one of the many issues which will be considered in the context of the pilot programme.