A savings limit of €100,000 per customer will be imposed on credit unions under regulations due to come into force in January.
Some lending restrictions are set to be relaxed over time and the new rules won’t bar the sector expanding into the mortgage market.
However, the Irish League of Credit Unions, the credit Union Development Association and the Credit Union Managers Association issued a joint statement saying they are ‘greatly concerned’ by the plan which imposes restrictions that don’t apply to banks.
In a joint statement, the three organisations criticised what they called the Central Bank decision to implement previous proposals with minimal changes, despite feedback from the sector.
‘In simple terms, these new regulations will ensure that credit unions are restricted from competing effectively with other financial service providers into the future.
Credit unions are now looking to provide more services to their members and their local communities at fair and reasonable rates. Instead the draconian rules published today will restrict credit unions from offering real choice to members.’