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THE CABINET IS due to discuss the introduction of a model of community or public banking in Ireland – a move that could change the way people access financing and even the way borrowers are treated by their lenders.
In November the Oireachtas Finance Committee had a panel of witnesses before it to highlight the potential benefits of the German ‘Sparkassen’ model of public banking.
This model of public banking falls in between the private commercial banks we are used to in Ireland, and the credit union model. The interest rates for savings deposits are 0%, but representatives from Germany told the committee that people still bring their deposits to Sparkassen because “they know they are safe”.
These banks would offer the same kinds of loans as commercial banks currently offer, but with more favourable terms.
Business loans would include leasing contracts and export financing. Mortgage customers could get a fixed rate for five, ten or 15 years.
Sparkassen is the largest banking group – and therefore market leader – in Germany.
The proposal on the table, put forward by representatives from Sparkassen, as well as the non-profitorganisation Irish Rural Link, is for the establishment of a pilot in the midlands.
Central Bank officials told the Finance Committee last week that they had met recently with these representatives to hear about their proposal. Officials from the Department of Rural and Community Development and the Department of Finance has also completed a report looking at the feasibility of a community-type banking model.
In response to a question from Labour TD Willie Penrose last week, Minister for Rural and Community Development, Michael Ring confirmed that he now has this report and it will be “brought to government shortly” for consideration.
“I will ensure this is done as quickly as possible.”
He said the project team had carried out detailed research into the public banking model, with a particular focus on Sparkassen.
A game changer
Penrose outlined a number of benefits of the model including that these banks would be municipally owned, rather than being nationalised entities.
“They would be not-for-profit and restricted to lending into the regional economy for the promotion of businesses. They would fill the gap left by the demise of building societies, including the ICS. Post offices and credit unions could earn additional income from providing public bank services across the counter at their branches,” he explained.
“The development of a network of regionally based public banks could be a game changer for small and medium enterprises, agribusiness and the regions.”
Penrose said he was concerned that the “dead hand of the bureaucrats at the Department of Finance will scuttle it”.
I am afraid they will resist anything new or novel or anything that represents something away from their cosy arrangements. They got their hands and fingers burned following the economic collapse and the crisis, when they took their eyes off of the ball together with the regulators. I am concerned that they are afraid or are reticent in this regard and that they will kill this before it gets out of the traps. I am keen to give the minister 150% support.
The minister should shake them up in the way he always shakes people up. He should not be afraid to take on the mandarins, who will try to kill this before it gets out of the traps.
“I might want to bring Deputy Penrose into the Cabinet meeting with me,” the minister replied.
“Certainly, this will be brought to the Cabinet as quickly as possible. I do not disagree with what Deputy Penrose has said, but at the same time we gave a commitment and I was given the responsibility to put the matter out for consultation. I did my part of the job. It is now a matter for the Department of Finance and myself.”
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This has been going on for many years but I’ve yet to see any virtue signalling Facebook or The Journal profile pictures displaying the DR Congo flag.
@Dan Broderick: That might be because Ukraine is a fellow European country, that more directly affects us, we have more of an affiliation with their plight; we host 60,000 Ukrainian refugees and we see the effects of the war daily on TV news and websites. It more directly affects us, regardless which side we favour.
And I suspect if we were to look at Facebook profiles of Congolese people from the region, and other peoples of neighbouring African countries, near were this massacre happened, I wouldn’t be surprised if they lack Ukraine flags but display various indications of Tutsi and Hutu support, they might not be directory involved but have a side they support, because their neighbours got massacred this time or previously (ca. 5.4 million dead though war and famine in the last 25 years or so). What do you think?
I suppose it would be virtue signalling if Irish people started showing Hutu flags in or Hutus started showing Ukraine flag in their profiles. But that’s not what is happening.
@Dan Broderick: careful now, you’ll have your comment deleted. Seems the journal delete every comment they don’t like! Censorship deprives the public from perspective
@John White: Does it?
@John White: https://jrnl.ie/5938495
@Gavin Conran: there’s a big difference in deleting comments that are factual and not identifying anyone in particular vs making hurtful accusations against an individual, guilty or not it’s for the courts to decide. That’s not what I’m disputing, I have had multiple comments deleted that were PC and factual as have many others.
The UN are a complete waste of space.
@Mike Dunne: fully agree.
animals
@joe doyle: animals are far and away better than these so called human beings.
@joe doyle: Animals, financed by the biggest conglomerates in the World. The Congo was plundered by Belgium before independence only to be replaced by big business. The Congo is blessed or plagued by the minerals that’s found there. Our mobile phones work because of Cobalt which is mined in the Congo. Diamonds Gold are just a few of the resources that is fought over in proxy wars in the Congo.
The Gov in the Congo uses the Russian mercenary group, Wagner, as it’s security force and a sister company holds most of the mineral mining rights as payment. Be very careful before you jump to any conclusions about events in Congo!
@Liam Dunne: The use of mercenaries in the Congo since it’s Independence has been the norm. South Africa has been a major source for mercenaries funded by Western Big business. The last thing the conglomerates want is the Division of the Congo to unite and have a stable government. Kinshasa broke away from the rest of the Congo after Independence, It was the richest part of the Congo in minerals etc. They had no problem in using mercenaries from Europe, Rhodesia,South Africa paid for by mining companies. Nothing has changed. The mineral wealth of the Congo makes it a battle ground for proxy wars.
They are worse than animals. Savages. With no civil or human morals. There has to be something that can be done with savages like these that are slaughtering innocent villages of people just trying to live their lives. They should be massacred themselves. Them and their ilk raping children and babies as a tool of their power. Big power with their machetes and machine guns. An absolute disgrace that this is still going on and there are Supposedly UN troops designed to tackle these so call armies. Why is this still happening. There are too many movies made from actual events and record of these events throughout the years and they make for disturbing viewing and yet even though acknowledged, there is more and more still allowed to happen without proper intervention from powers that be. SADLY
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