Central Bank extends knowledge and competence standards for credit unions

• New regulations extend minimum competency requirements for credit unions
• Credit union staff in scope will be required to obtain relevant qualifications
• Further strengthens the consumer protection framework for credit union members

The Central Bank of Ireland has today (28 September 2023) announced new requirements for certain credit union staff undertaking particular activities.  These requirements are set out in the Minimum Competency Code 2017 and the Minimum Competency Regulations 2017 (together the Standards), which will now apply to all relevant in-scope credit union services. 

Credit union staff providing services within the scope of the Standards, including, but not limited to, lending and term deposits, will need to meet minimum knowledge and competence standards. These standards will mean that credit union members are protected in the same way as consumers using similar services offered by other financial services providers.

The Standards have been developed following extensive consultation with the credit union sector and are designed to enhance the skill set of credit union staff across Ireland.

Director of Financial Regulation – Policy and Risk, Gerry Cross said: “These new rules introduce further enhancements to our consumer protection framework for credit unions.  They reflect the importance of credit unions in Irish daily life, and the sector’s commitment to their members is demonstrated by the fact that many credit union staff already meet these standards. 

“Applying these requirements to credit unions will help to build on the existing high levels of knowledge and expertise in the sector. This will further strengthen the quality of the service provided to credit union members and underpin the current evolution in credit union business models.”

“I’d like to acknowledge the positive engagement we have had with the credit union sector and their educational bodies and thank all of those who responded to this consultation.”

As the Standards apply to persons exercising certain Fitness and Probity Controlled Functions, amendments are also being made to the Fitness and Probity Regulations for credit unions, to introduce additional controlled functions for credit unions.

The minimum competency changes will come into effect on 1 October 2024, with a four-year transition period until 1 October 2028.  The fitness and probity changes will be effective from 1 October 2024.

Credit union staff who are currently undertaking in-scope activities can avail of transitional arrangements to comply with the Standards and obtain relevant qualifications.  

Notes to Editor

The changes were consulted upon in Consultation Paper 147, which the Central Bank published in January 2022.

Prior to these amendments, the Minimum Competency Standards only applied to credit unions when acting as retail intermediaries, providing mortgage credit agreements in line with the knowledge and competence requirements of the European Union (Consumer Mortgage Credit Agreements) Regulations 2016, and devising or creating mortgage credit products, advising on or arranging or offering to arrange mortgage credit products or carrying out a specified function in respect of such products.

The Minimum Competency Standards are a component of the Central Bank’s Fitness and Probity regime. The Standards apply to persons who are exercising controlled functions, as defined in the Fitness and Probity Regulations. In order to apply the Standards to credit unions, the Fitness and Probity Regulations are also being amended to introduce additional controlled functions for credit unions, which will be effective from 1 October 2024.

Consultation Paper 147: Application of the Minimum Competency Code 2017 and the Minimum Competency Regulations 2017 to credit union core services.

Consultation Paper 147: Feedback Statement 

Minimum Competency Code and Minimum Competency Regulations 2017

Central Bank (Supervision and Enforcement) Act 2012 (Section 48(1)) (Minimum Competency) Regulations 2023 [S.I. No. [  453] of 2023]

Central Bank Reform Act 2010 (Sections 20 and 22 – Credit Unions) (Amendment) Regulations 2023 [S.I. No. [454] of 2023]