Credit unions are deeply embedded in Irish life, but are they good for savings? Here's the honest assessment.
Credit Union Dividend Rates
Credit unions pay dividends, not interest. Rates vary by credit union:
| Typical Range | Rate |
|---|---|
| Low | 0.25-0.50% |
| Average | 0.50-1.00% |
| Good | 1.00-2.00% |
| Exceptional | 2.00%+ |
Each credit union sets its own rate. Check yours directly.
Credit Union vs Bank Savings
| Factor | Credit Union | Bunq | AIB |
|---|---|---|---|
| Typical rate | 0.5-1.5% | 2.01% | 0.25% |
| DIRT applies? | Yes | Yes | Yes |
| Protection | €10,000 | €100,000 | €100,000 |
| Access | Varies | Instant | Instant |
| Loans | Yes | No | Yes |
The Protection Issue
Critical difference: Credit union protection is only €10,000, not €100,000.
| Institution | Protection |
|---|---|
| Banks | €100,000 (Deposit Guarantee) |
| Credit Unions | €10,000 (Savings Protection Scheme) |
For amounts over €10,000, banks offer significantly more protection.
When Credit Unions Make Sense
Good For:
- Loan access - Credit unions often approve loans when banks won't
- Community connection - Local, member-owned
- Small savers - Under €10,000, protection gap doesn't matter
- Relationship - Some value personal service
Not Good For:
- Maximum returns - Bunq beats most credit unions
- Large amounts - Protection only €10,000
- Convenience - Many have limited hours/app functionality
Credit Union Dividends and DIRT
Credit union dividends ARE subject to DIRT (41%), same as bank interest.
| Dividend | DIRT | You Receive |
|---|---|---|
| 1.00% | 0.41% | 0.59% |
| 1.50% | 0.62% | 0.89% |
| 2.00% | 0.82% | 1.18% |
Should You Move Savings from Credit Union?
Yes, If:
- You have more than €10,000 saved
- Your credit union pays less than 2%
- You don't need loan access
- You're comfortable with app banking
No, If:
- You value the loan relationship
- Savings under €10,000
- Your credit union pays 2%+
- You prefer local, in-person banking
Best of Both Worlds
Many people:
- Keep €5,000-10,000 in credit union (for loan access)
- Put excess in Bunq (for better rate + protection)
This maintains the relationship while optimizing returns.
Summary
| Factor | Credit Union | Verdict |
|---|---|---|
| Rate | 0.5-1.5% typical | Below neobanks |
| Protection | €10,000 | Well below banks |
| Loan access | Excellent | Key advantage |
| Community | Strong | Personal value |
Bottom line: Credit unions are valuable for loan relationships and community banking, but not optimal for savings maximization.
Last updated: January 2026