Wednesday, 4 May 2016




(23rd April 2016) 1,000 delegates from 420 credit unions across Ireland are met on the weekend of the 23rd / 24th April 2016 at the Irish League of Credit Unions Annual General Meeting at the University of Limerick Concert Hall. The theme for the weekend’s conference was ‘Credit Unions –Shaping our own future’ and discussions primarily focused on the strategic review of the credit union movement and the opportunities for growth that this presents. President of Ireland, Michael D Higgins delivered the opening address to delegates at the event on Saturday morning.

Over the course of the weekend, delegates heard presentations and analysis and contributed to detailed discussions on critical aspects of credit union operations. Regulatory and legislative changes will be key agenda items, as credit unions move to offer a broader range of services to the increasing needs and demands of their growing membership.
The movement is a ‘sleeping giant’ with millions of members, significant financial resources, dedicated volunteers, professional managers and staff, and a priceless reputation for integrity. In particular, the not-for-profit business model, social contribution and democratic processes differentiate the movement from other financial services.
However, the movement as a collective has not realised its full potential over the past two decades. While members are saving more, loan to asset ratios have dropped across the island. Cash and investments have increased, but they are producing very low returns. Meanwhile, costs are increasing.
Against this background, the ILCU Board decided to establish a Review of the Irish League of Credit Unions and appointed Dr. Eddie Molloy and his team at Advanced Organisation. The Review’s scope balanced the need for a broad representation of voices with the need to quickly make recommendations and progress change.
Advanced Organisation employed extensive ‘bottom-up’ engagement with credit union volunteers and staff representative of different credit union categories (by size, location, bond type and stage of development) across the island. In addition, credit union movements in other countries were researched and engaged to understand best practice relevant to credit union performance.
The review produced three deliverables:
1.      A candid analysis of the challenges that prompted the Review;
2.      Identification of the root causes of these presenting problems;
3.      Recommended solutions in the form of:
·         A comprehensive vision of the future for the all-island Credit Union Movement;
·         An implementation road-map with indicative costs.
The central challenge is to design a movement that is more coordinated, coherent, and cost effective through an empowered Centre, while at the same time respecting and strengthening the autonomy of local credit unions.
The ultimate aim is to provide a full range of ethical financial products and services to meet people’s immediate and long term needs throughout their lives, and to operate a sustainable business model which provides a social return so that credit unions can contribute more to local communities, Irish society and developing countries. To achieve this aim, we will need to collaborate with key stakeholders across the island including Governments, regulatory bodies and the many businesses we partner with.
Shortly, after the ILCU AGM, the final report will be presented to the Board. At this time, the ILCU Board will decide whether to call an SGM to approve the first 12 months of implementation - inclusive of costs and funding mechanisms.

The potential for the credit union movement to make additional contributions towards broader community based and social needs by investing funds in social housing and small businesses for example, will also be discussed by delegates at the 2016 conference. The key benefit arising for the credit union movement from the social housing proposition would be that it would enable the movement to put a significant portion of the member funds to a more productive and economically rewarding purpose, while at the same time, addressing a key social issue that deeply affects the communities which credit unions serve. In 2015, the ILCU submitted detailed proposals to Government about how credit union funds could be provided for social housing. The proposals centred around two options. Credit unions invest in a state owned “financial vehicle” which would on-lend to Approved Housing Bodies to fund the development of social housing or credit unions invest and on-lend directly to Approved Housing Bodies to fund the development of social housing. We are currently waiting on a response from Government on these proposals.

Providing credit to small and micro businesses is something that credit unions already do and continuing to do so, in a more substantive way, is a key contribution that the credit union movement can make to a recovering economy. In a new SME discussion document, the ILCU has outlined how providing SME’s with the necessary supports to foster a culture of growth orientation and dynamism is a key matter of national policy.  In line with its operating principles, the credit union movement has an interest in supporting a vibrant and well- funded SME sector and given the economic importance of SME’s in the overall well-being of the wider economy, the Irish credit union movement has a strategic interest in supporting the sector.
Proposals contained in the discussion document focus on creating a central fund, back by a state guaranteed bond, in which individual credit unions could invest. Expertly supported and effectively regulated, pooling the resources that participating credit unions hold individually will ensure the availability of credit more widely throughout the economy.  This would match available credit union capacity with small enterprises that need credit to survive and develop.
Both the SME and social housing proposals are very closely aligned to the core values of the credit union movement - economic democracy, inclusiveness, human and social development and community focus. Credit unions are rooted in the communities that they serve. Just as credit unions had a vital place and role to play in the financial services industry in the past, credit unions today are still essential and are poised to play an important role in continuing to help their members through the current economic times by offering the financial services they want and need.

Ireland has the greatest membership penetration rate in Europe, with current membership at over 3 million members. In a reflection of the popularity and influence of the credit union movement across the island of Ireland, Belfast has this year been chosen to host the World Council of Credit Unions (WOCCU) annual conference. Over 2,000 credit union representatives from as many as 54 countries worldwide will descend on the city for the worldwide credit union movement’s premier event, taking place in July 2016 in the newly refurbished Waterfront Hall.

Commenting on AGM, ILCU President Brian McCrory said: "The credit union movement has played a key role in creating vibrant, local communities and developing our economy and society for half a century by providing accessible financial services and support. This weekend's meeting will be an important one as credit unions look to changes within the sector. 

He added: “The spotlight will be focused on how regulatory and legislative changes can lead to greater freedom for credit unions in service provision - certainly meeting the growing needs of our members is hugely important to credit unions. It is a given that change will be necessary for the ongoing renewal, updating and modernisation of our credit unions however, change does not involve sacrificing our ethos and our core values - values which have allowed credit unions to remain a popular financial service provider throughout the years."