Issue 2 - 2024 200dpi

24 July 2008 Edition

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The Mitchel McLaughlin Column

Release Credit Union potential to ease economic pressure

THE Credit Union movement was introduced to Ireland in the 1960s by community activists concerned at the disadvantage experienced by working class people in accessing credit. The Credit Union Movement emerged because many working class communities were in the grip of money lenders and did not have financial collateral required by banks as security against borrowings.
In the present economic turndown government focus seems to be on protecting the interests of the banks and large financial institutions. There is little attention being given to assisting those most directly affected by the present financial conditions – the worker whose labour made a major contribution to the economic prosperity enjoyed by developers, speculators and yes  – banks over the recent decades.
I believe that it would relieve a lot of the financial pressure on those construction workers, people caught up in the mortgage crunch and those on fixed incomes if the wider potential of the Credit Union movement across the island were to be released. Being community based, Credit Unions are probably the most secure of financial institutions given the fact that they are not driven by the pressure to deliver massive dividends to stockholders. I would urge the respective Finance Ministers North and South to explore the possibilities that could be available if the Credit Unions powers to offer a wider range of financial services were extended to mirror those available by other financial institutions.
With the growth of the Credit Union Movement throughout Ireland over the past 30 to 40 years those people living in economically deprived communities were for the first time given an opportunity to sample some of the comforts of life. Credit Unions are now part of the social fabric of most communities. I believe that further extending the financial services available at Credit Unions at this time could similarly offer protection to a wider section of society from the worst effects of the present economic downturn. Unlike the multi-national corporate structure of many financial institutions, the Credit Union is community based and welcoming of all, irrespective of their financial situation. For this reason it is better placed to offer support and financial advice to that section of the population who would not be the first priority of the Banking institutions.
While I recognise that it is imperative for governments to take measures to protect against the collapse of the financial sector they also have a responsibility to protect the individual citizen who is a victim of the manipulation of the economic conditions. I believe that Credit Unions should be given the opportunity to offer a wider range of advice and financial services to meet the changing needs of their customers.
This would relieve the anxiety that many have about banks and Mortgage Companies. It would also ensure that any profits accrued from such transactions would benefit the local community.

An Phoblacht
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