Credit unions gain expanded lending capacity under new rules

The Central Bank of Ireland’s revised credit union lending framework has taken effect since September 30, allowing significant expansion in both home and business lending. Home loan limits have increased to 30% of total assets, while business loans can now reach 15%, decoupling previous combined limits and removing the need for business plans on loans over €25,000.

Previously, credit unions could lend up to 15% of total assets across both home and business loans, roughly €3 billion. With total sector assets of €22.05 billion, the new framework enables up to €6.6 billion in home loans and €3.3 billion in business loans.

Finance Minister Paschal Donohoe welcomed the changes, highlighting that they allow credit unions to expand and diversify their loan portfolios and provide more services to members. Minister of State Robert Troy emphasised the potential for increased competition and improved consumer outcomes, noting the unique national footprint of credit unions as a key driver of community-based financial access.

The framework changes are expected to stimulate lending, support small businesses and homeowners, and enhance choice for consumers across Ireland, reinforcing credit unions’ role as an important component of the national financial ecosystem.

Read the full article to explore how these regulatory changes could reshape Ireland’s lending landscape.