Public banking has real potential for rural Ireland says Penrose

The introduction of a public banking network has great potential for rural Ireland, Deputy Willie Penrose believes.

Speaking following the announcement that the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs are investigating the potential of a German style public banking system, Deputy Penrose says that the concept is poorly understood and needs wider promotion.

"A public bank is emphatically not a nationalised bank like AIB. A public banking model has existed in Germany for 200 year. German public banks, Sparkasse, are municipally owned. The are not for profit and are restricted to lending to the regional economy."

If introduced in Ireland, Deputy Penrose believes that they could help "fill the gap left by the demise of the Building Societies and the ACC" and that post offices and credit could earn additional income by providing public banks services.

"The Sparkasse Foundation for International Co-operation (SBFIC) has done an enormous amount of work investigating the potential establishment of a pilot public bank in Ireland.

"I understand that the Sparkasse Foundation are willing to offer considerable technical expertise and help mentor an Irish Pilot Public Bank even to the extent of providing training and mentoring of staff in the pilot until it would be up and running.

"This would be very much along the model of how the American Credit Unions mentored the embryonic Irish Credit Union movement in the 1950s and 60s.

"Ireland has a great opportunity here to strengthen regional development with tried and tested expertise and assistance and I urge the Government not to squander the opportunity."