The report of the Credit Union Advisory Committee (CUAC) on ‘Shared Branching’ by credit unions has been published today (31 July 2013) by the Minister for Finance on the Department of Finance website.
Background
In November 2012, the Minister for Finance requested the CUAC to compile a report on the potential for shared branching in the Irish credit union movement. The CUAC was asked to address the following:
· An assessment of the current appetite for shared branching among credit unions and their members
· An analysis of the framework requirements to support shared branching
· An exploration of the various alternatives and approaches drawing on international experience and best practice
· Recommendations, including any required legislative changes.
Recommendations
The recommendations of the report are as follows:
· Shared branching should not be considered in the credit union movement at the present time. There is no appetite for shared branching in credit unions and it is not regarded as a priority at credit union level.
· Research on back office collaboration should be encouraged. There appears to be a greater interest and commitment from credit unions in exploring collaboration on back office operations rather than shared branching.
· Greater take up of the significant IT capability already available to the Irish credit union movement and which credit unions have access to, should be encouraged.
· There is no requirement for legislative change as there does not appear to be an appetite for shared branching in the Irish credit union movement.
The Minister for Finance, Michael Noonan, T.D. has accepted the recommendations in the CUAC Report.
Notes to Editors
What is shared branching?
Shared branching is defined in the report as “a formal facility between participating credit unions whereby members of one credit union can carry out financial transactions, such as lodgements and withdrawals, at any of the participating credit unions”.
Is this the same as shared services?
Shared branching is distinct from ‘shared services’, which involves back office collaboration
.
What is the Credit Union Advisory Committee (CUAC)
The CUAC is a statutory committee, established under the Credit Union Act 1997 to advise the Minister for Finance on credit union matters.
Did CUAC consult with the key stakeholders on the Report?
In compiling its report the CUAC consulted with key stakeholders in the credit union sector including the Irish League of Credit Unions (ILCU), the Credit Union Development Association (CUDA), Credit Union Managers Association (CUMA) and the Credit Union Technology Suppliers Forum (CUTSF).