by Bernie English
MILLIONS of Euro of savings in Limerick’s 28 credit unions could be under threat if a policy to give the banks priority in debt collection comes into effect.
And credit union sources in the city say that the banks are putting pressure on because they are aware that most people will pay credit union debt first.
MEP Marian Harkin has accused the government of threatening the future of the co-operative credit union movement in favour of the banks which, she said, have caused incalculable harm to the entire social fabric of the country.
Government, Central Bank and regulator’s policy is that credit unions give banks preferential access to creditors, a policy which Ms Harkin says people must insist their elected representatives oppose.
Meanwhile, sources within the extensive credit union network in Limerick have cast light on why the policy might favour the banks.
“It’s a fact that people will pay their credit union loans first. When debts mount up, people will pay the grocery bill when they get some money and they will pay the credit union because if they default on those, they are defaulting on their friends and neighbours.
“The banks were always the big, corporate, faceless institutions. Credit unions are local – the banks know this and they don’t like it”. the source said.
Ms Harkin said that the banks and the Central Bank as their regulator have lost all moral or business right to insist that their debts take precedence over debt repayment to the credit unions.
via Credit unions losing out to fat-cat banks | Limerick Post Newswrite.
