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Minister Donohoe publishes independent external evaluation on Local Public Banking
Report finds that there is no economic case for the establishment of a State owned public banking network
The Minister for Finance and Public Expenditure and Reform, Paschal Donohoe TD, has today (Thursday) published an independent report by Indecon International Economic Consultants on Community Banking in Ireland. Community Banking Evaluation - Indecon Report
The report concludes that there is no business case for the State to establish a public banking system in Ireland, supporting the outcome of a previous report on this issue published by the Department of Finance and the Department of Rural and Community Development in 2018.
While Indecon’s report concluded there are some areas of market failure, it noted that there is extensive provision of banking services, as well as a wide range of Exchequer funded existing supports, and that there is no case for the establishment of a new State owned banking network. Credit unions are considered to be a ‘community bank’ with an increasing offering of financial products for their members. An Post is also increasing its financial offerings and there is a significant network of post offices in areas where there is no bank branch within five kilometers.
Minister Donohoe said:
The Programme for Government contains a commitment to undertake an investigation of the possibility of bringing in a Community Banking system into Ireland. This commitment was met by Minister Ring and I last year when we published a paper on Local Public Banking. This paper contained a commitment to commission an independent external evaluation to look again at the area of, and potential for, Community Banking here in Ireland. One of the main findings of the report is that there is no economic case for the establishment of a State owned public banking network here in Ireland. I will be carefully considering the recommendations contained within the report, in conjunction with my Government colleagues. The Government remains fully committed to supporting the SME sector, and this report recognises the supports the State has in place to assist them.