Here’s an interesting development in the aftermath of the PMS crisis which will bring some security to savers with Credit Unions. It’s a pity this provision wasn’t in place for the PMS prior to 2008.
Credit union customers in NI are to enjoy the same protection as those at ordinary banks.
The Financial Services Authority (FSA) and HM Treasury (HMT) have today jointly announced that Northern Ireland’s credit union customers will have their deposits protected to the value of £85,000.
The change will come into effect on 31 March 2012 when regulation of all 177 credit unions passes from the Northern Ireland Department of Enterprise and Investment to the FSA. As well as bringing customers within the scope of the Financial Services Compensation Scheme, this move will also give them access to the Financial Ombudsman Service.
Martin Stewart, Head of Building Societies and Credit Unions at the FSA said: ”The changes mean that credit union customers will have the same protection as those using banks.
”In January the FSA will be hosting a further round of road shows in Belfast, Londonderry and Newry amongst others to assist credit unions prepare for the transfer process.”
The changes were partly in the wake of the collapse of the Presbyterian Mutual Society, and see the regulation of all 177 credit unions pass from the Department of Enterprise to the FSA and will therefore fall under the compensation scheme, which underwrites savers’ accounts up to £85,000.
Last September, HM Treasury and the FSA published a joint consultation paper on the future regulation of Northern Ireland credit unions (NICUs), a process since concluded with today’s outcome announced.