Investing in the people’s bank

In the reception area of Thomastown Credit Union, there's a Cromwellian cannonball in a glass display case. It was discovered in the walls of the building when it was being remade as a credit union in the mid 1990s and probably dates from when Cromwell was making a hames of Jerpoint Abbey down the road. Next to the cannonball sits a framed photograph of the late Canon Carroll, the stern-looking but smiling founder of this credit union.

"We have a Canon Carroll educational scholarship," says Maria Maher, one of four tellers employed here. "I tell people the Canon Carroll scholarship forms are over by the cannonball. Some of them miss the joke."

Thomastown Credit Union was established in 1969 and is one of over 400 such co-operatively-owned savings and loan institutions nationwide. Credit unions were established in the 1950s to address the needs of people ignored by the conventional banks and there are now more than 2.9 million credit union members.

“The credit union was known as poor person’s banks,” says the manager, Anne-Marie Daly. Traditionally run by members, in recent years more complex regulatory needs meant an increased requirement for professionally trained, full-time managers such as Daly. “Things just got too complicated,” says the current chairman, Joe Doyle.

For decades it was voluntarism and localism which kept the credit unions afloat. Doyle is a retired teacher who works here on a voluntary basis. “I’m involved in a lot of local voluntary organisations,” he says, and laughs. “I suppose I’m one of those people.”

Retired headmaster and current treasurer Chris Green managed the credit union on a voluntary basis before Daly was hired. "I joined as a member and was asked to be treasurer-manager on almost the same day more than 40 years ago," he says.

“I think they had their eye on me. Nobody wants those jobs. We find even now that it’s difficult to get volunteers into the organisation, especially for the onerous kind of jobs. Then you read a letter at the meetings from the regulator about this and that and what the sanctions will be if you don’t comply. You do think ‘What the heck am I doing here?’ ”

Thomastown Credit Union currently has almost 5,000 members united by what the credit union movement terms a “common bond” of shared ownership and localism. The 15 directors, says Doyle, all live within a five-mile radius of the credit union. “We say ‘members’, not ‘customers’,” says Maher. “And we say ‘surplus’, not ‘profit’.”

The average loan is quite low and tends to be for things such as cars and home improvements. The highest, says Daly, is in the region of €25,000. “In recent years,” she says, “there’s been an increase in people borrowing for things like heating oil.”

Loans need to be “provident and productive” says Doyle. But they have over the years included holidays, gym and golf-club membership and musical equipment. They do not do business loans, but there are grey areas. “If a carpenter buys a new van or something, is that a business loan?” asks Doyle.

They want to help. In the credit controller’s office there is a calendar with a quote from Ralph Waldo Emerson: “The only way to have a friend is to be one.”

“You’d bend over backwards to make sure someone gets the loan they need,” says Daly. “It’s a small community so you know how much a loan means to someone. In a bank, if someone has a high income and loads of security they’ll get their loan. With credit unions you might have someone on social welfare who really needs €600 for heating oil. It keeps them away from money lenders. And there are some people on social welfare who would be the first people in to pay their loans.”

There have been a lot of changes in Thomastown. AIB recently left town. “There was an 80-year-old man who got his pension from England and when AIB left he was left high and dry,” says Maria Maher. “We tried our best to get all the details and sorted it out.”

Recently Thomastown Credit Union merged with the smaller credit union in nearby Bennettsbridge. The current building, shared with FÁS, was formerly a shoe shop. As well as the aforementioned canon and cannonball, the reception area features paintings by members, some striking historical maps of Thomastown by local cartographer Tom Dack, memoirs by locals and a bulletin board advertising local events.

The atmosphere is unrelentingly friendly.

“They say they’re going to start rationing water,” says one visitor, complaining about the heat. “Thought I’d let you know the rain’s started!” announces another as she enters with damp shoulders. A third chuckles cheerfully as she withdraws some money. “I don’t know what happens but money seems to disappear on me fast and furious.”

Everyone compares the credit union experience to that of banks. While the credit union has become more professional, like a bank, the bank has not become friendlier, like a credit union.

“The bank I’m using at the moment, it’s like they don’t want you coming into them,” says Liam O’Keefe a local farmer and agricultural contractor. “That’s the attitude. It’s like they don’t really want to see you. I think it’s scandalous the way the banks are treating people.”

Liz O’Neill remembers her first loan. “£30 to go see Bruce Springsteen back in the 1980s. I was still at school doing a summer job and I was earning maybe £8. I said ‘I’ll give you back £8 every week’ and he said ‘No that’s not what it’s about! You give back a pound or two pounds.’ I wanted to go so badly, I’d have given him £8.”

Hannah Murphy is enquiring about an education loan. She’s about to start studying adult nursing at the University of West London. “It’s very important for things like this,” she says. Another woman wants me to mention the support the credit union has given to the local football team Thomastown United.

Many people are saving. Thrift is one of the core values of the credit union movement. They run savings clubs at schools and many of the people I meet have ways of balancing budgets that would make finance ministers ashamed of themselves. “Young mothers have it down to a tee,” says Maria Maher. “They’re amazing. They’re in the saving club and have maybe two loans within the one account and are well able to manage and budget with very little.”

Marie Hayes, who is currently unemployed, says she’d never have saved without the credit union. “It’s a bit different from the bank because once it’s in it you don’t want to take it out, you want to keep it there. Maybe it’s because you have to ask for it in the credit union.”

Some have more idiosyncratic reasons for liking it. Hannah Delahunty and Ciara Baron are 13 years old and have been members since they were babies. Delahunty’s aunt works here and when she was younger she was allowed behind the counter. Why does she like it here? “It smells really nice,” she says.

Others have more fundamental reasons to appreciate it. Japanese-born Yosihide Tasaki lost his job as a care-worker over a year ago. He uses the credit union to save. He calls it “the people’s bank. I think it’s very important”.

The “people’s bank” is dealing with changing times. Most credit unions showed restraint during the Celtic Tiger, but many are dealing with the consequences of the recession. “The boom passed us by because it wasn’t unusual to get a piece of junk mail from a bank saying ‘phone this number and get €25,000,’ says Doyle. “We weren’t lending money so we had to put it somewhere . . . Then we lost money under the Anglo Irish Bank liquidation.” The Thomastown Credit Union lost €460,000. “I don’t know if the politicians thought of the consequences of that on local communities.”

The increasing demands for regulation, some outlined in last year’s Credit Union Act, also mean that the ethos of voluntarism and localism could be undermined over time.

“There are approximately 400 credit unions and the Central Bank would prefer to knock a zero off that,” says Doyle. “They have to deal with 400 returns and statements. That’s a lot of paperwork from their point of view. They might also argue that it would be more professional with a smaller number of credit unions.”

More complex rules also require professional training. While the regulation, Doyle stresses, is often very necessary, “it’s going to make it more difficult for community cooperatives to go on the way they’ve been going.”

Back behind the counter, the staff of Thomastown Credit Union reminisce. "Canon Carroll was a very clever man," says Anna Minogue, who left her job as a meter-reader for the ESB, to become the credit union's first full-time employee in 1991. "But he hated lending money for weddings," she laughs. "He really had a thing about lending to weddings."

Green recalls their first attempt to computerise back in the 1980s. “We were working with a company and the place was filled with boxes ready to be installed. Then they went bust. “We had all the stuff and no one to show us what to do with it,” says Minogue. But things usually worked out for the best. “People trust the credit union,” she adds. “They own the credit union; 95 per cent of the people who come in here you’d know personally and have an insight into their lives. Banks don’t have time for people. We know all f our members. And if I don’t know them, Anne-Marie will or Joe will or Marie will.” In the reception area, the photo of Canon Carroll seems to radiate his approval.