A GROUP OF 16 credit unions is looking at offering lending services to small to medium enterprises (SMEs) as part of a €10 million collaboration with financial technology company Fexco.
The group has partnered with Fexco to launch a joint venture, called Metamo, which is based in Kerry with offices in Dublin. It will develop products and services for credit unions around the country and is looking at moving into the SME market.
Together the credit unions, which are spread throughout the country, represent more than 480,000 members and have combined assets of over €3 billion.
As well as providing financial products, Metamo aims to develop more efficient operating systems for credit unions in areas like process improvement, risk management and technology delivery.
Speaking to Fora, Neil Hosty, who has been appointed as chief executive of Metamo, said the organisation aims to build out the capability for credit unions to enter the SME lending market.
“Over 90% of credit union lending is described as personal typical lending, that pays for a car, for third-level education, or for home loans,” he said.
According to Hosty, credit unions are successful with this type of lending – with a 30% share of the market in Ireland – but their challenge is that their range is narrow.
“If Metamo starts to develop capabilities for SME to deliver lending solutions to SMEs or to families under different loan products, then absolutely there will be demand there, because trust has already been built up,” he added.
He said that for the past four years they have been rated the number one customer experience brand in Ireland across all business sectors.
Speaking at the launch today, Minister for Finance Paschal Donohoe said that credit unions “provide invaluable services to local communities” and he was encouraged and supportive of projects that drive the sector forward.