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Credit unions finally take over banks with a new current account

The move has taken years, as the sector has been trying to get regulators' approval for its attempts to offer consumers an alternative to banks.

Now 30 of the largest credit unions have launched a new full-service current account.

This will mean that they will be able to compete with banks for daily banking services.

Approved by the Central Bank, the new move will feature lenders offering a MasterCard debit card, free point-of-sale and contactless payments, free debit and order processing, and mobile and online banking.

Will have a monthly fee of 4 €. There is also an overpass facility. This is the first time credit unions have offered an overdraft.

The application needs to be run, something that has become standard for many people with a current account.

Some credit unions have debit cards and limited current accounts, but the new move marks the first time they have come together to offer a comprehensive current account approved by the Central Bank.

Although the new offer is not cheaper than the current accounts offered by banks, it is thought that the high levels of loyalty generated by credit unions will see many members deciding to do all their daily banking with them.

Others who are disgusted with the activities of the mainstream banks, once issued on bail, are likely to register.

Among the 30 credit unions are some of the largest in the country, including St. Kanike in Kilkenny, Drogda and Progressive in North Dublin. Industrial credit unions include Savivi, which has a large number of employees at the ESC, the St. Paul Guard Credit Union and the Health Services PI.

Transparency in the wider banking sector by credit unions has long been troubled, but so far has hit a number of stumbles.

Three years ago, the Central Bank effectively blocked the launch of an alternative to the current bank accounts of 11 credit unions, amid fears that the product did not meet all its regulatory requirements.

Now the current account market is intensely competitive with low cost contribution from fintechs Revolut and N26 attracts thousands of younger customers.

Credit unions formed Creditunion.ie to finance the development of the new current account.

Currentaccount.ie CEO Seamus Newcombe said launching the current account is an important milestone in the development of the credit unions sector.

Darrag Cassidy, on the price comparison website Bonkers.ie, said the new account offers little new and its price is not too competitive.

"In fact, depending on how you use your current account, there are already cheaper alternatives to the likes of KBC and Permanent TSB. And in terms of Internet options, N26 and Revolut offer much more than any Irish bank or credit union of attendees ”

But he said the credit union's payment structure is simple and straightforward and customers will know what they have to pay each quarter.

Irish Independent

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