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Northern Ireland's credit unions gain ground as lending leaps £9m in year

By Staff Reporter

Published 08/10/2015

The Duchess of Cornwall meets schoolchildren during a visit to Ballyhackamore Credit Union in east Belfast earlier this year
The Duchess of Cornwall meets schoolchildren during a visit to Ballyhackamore Credit Union in east Belfast earlier this year

Credit unions are growing across Northern Ireland, with membership up 3% to 457,000 in 95 branches in the third quarter of the year, according to the Irish League of Credit Unions (ILCU).

Lending was up by £9m year-on-year, and arrears and bad debts were low, the ILCU said.

Membership of credit unions in the ILCU's umbrella group increased by 15,000.

The group said the growth was evidence of loyalty to a form of not-for-profit lending, which the ILCU claimed could save desperate people from payday lenders.

Camilla, the Duchess of Cornwall, threw her support behind the credit union movement during a visit to Northern Ireland with her husband, the Prince of Wales, earlier this year, when she called at the Ballyhackamore Credit Union, which is part of the ILCU.

She also revealed that she was a member of the London Mutual Credit Union.

ILCU president Brian McCrory said: "Once again, credit unions in Northern Ireland have experienced growth across the board, with figures for the third quarter of 2015 showing increased membership, savings, assets and loans to members.

"The ILCU's 95 Northern Ireland credit unions have £462m in loans to their membership. This was an increase of £9m (or 2.1%) year-on-year. Membership has shown a year-on-year increase, rising by 15,000 in the same period. In addition, savings increased significantly by 6% to £1.077bn."

The ILCU added that demand had held up in Northern Ireland partly because the economic climate was stronger here than in the Republic, with a lower rate of unemployment.

Loan arrears here - where net loan balances had been in arrears for three months or more - were £20m in June, down from £21m in June 2014.

The average return on savings in 2014 was 1.2%.

But the ILCU said that not all credit unions had paid out a return, also known as a dividend, on savers' funds - the equivalent of interest earned on savings in banks and building societies.

A spokeswoman said: "Some credit unions opted to build up loan provisions and capital reserves rather than pay a dividend."

But the lack of a dividend was not affecting savings levels, the spokeswoman added.

"This is a combination of the fact that banks are offering historically low returns on savings and the continued member loyalty to their credit union," she said.

The ILCU is the trade and representative body for 95 credit unions in Northern Ireland.

The credit unions in the ILCU do not include the 45 unions in the separate Ulster Federation of Credit Unions.

Rowallane Credit Union, part of the Ulster Federation, was liquidated earlier this year, although its 700 members were repaid around £1.4m in total deposits afterwards.

Belfast Telegraph

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