Credit unions head for courts in debt quest

The Irish credit union movement has pursued members through the courts for debts of nearly €35m over the last three years.

Since 2011, almost 2,000 members have had judgments registered against them for failing to repay monies borrowed.

In 2011, credit unions registered €12.7m worth of judgments against defaulters, in 2012 it rose to €13m, and by Nov 2013, €9m worth of judgments had been registered, according to figures from Vision-net.

Cork’s Charleville Credit Union registered the highest value of judgments in the country in 2013 at €1.05m. It also had the second highest single judgment at €521,000 registered.

Roscrea Credit Union registered the single highest judgment in the country at nearly €750,000, and the second highest overall judgment at nearly €900,000.

St Canice’s Credit Union in Kilkenny had the third highest level of judgments at €413,000.

The single smallest judgment was for some €348, registered by Malahide and District Credit Union.

A spokesman for the Irish League of Credit Unions said its members are often left with little choice but to use the courts to recover money lent to members.

“Credit unions always encourage members to contact them as early as possible if they are unable to repay a loan or are in financial difficulty, to discuss the possibility of changing their repayment plan. Credit unions, to the best of their ability and subject to legal requirements and restrictions, will try to accommodate members where possible,” he said.

“Credit unions use members’ savings to loan to other members and as such they must protect the interests of all members. Credit unions have a duty of care to try to retrieve a loan and in some unfortunate cases are left with no other option than to institute legal action.”

Director general of the Free Legal Advice Centre, Noeline Blackwell, said credit unions have to recover the money, but the only way to do it is through a “feudal” courts system.

“Credit unions are in a difficult situation as the only way to recover the money is through an antiquated system. The €300 judgment shows us what hasn’t happened in terms of law reform. There should be a better way of debt enforcement but the credit union has no choice but to register judgments.”

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