For decades the Credit Union has played a central part in Irish life but in a country that has seen a lot of change in recent years, in both its culture and its banking sector, is the future bright or bleak for the credit union?

Colm O’Grady is the Head of The Credit Union Division at business consultancy firm Russell Brennan Keane and he joined Bobby Kerr on Down to Business to discuss the industry.

He believes that there are three main challenges facing Ireland's credit unions:

• They are struggling to keep up to date with, and on top of, modern complex financial regulations
• Ability to make money - low-interest rates mean they are being charged to park money in banks. The solution to this problem could be lending more money out to members.
• Dealing with the fragmented nature of the market

Ireland has more than 300 independently owned credit unions and many depend on volunteers to run them.

Mr O'Grady comments that with these individual branches "doing their own thing" it makes it hard to implement changes across the industry.

Ireland once had more than 400 Credit Unions, Colm warns that branches will either need to consolidate or to pool resources in the coming years to survive.

"They either need to merge or they need to have central services that would offer a united voice - offer IT - offer marketing - offer technology. That's a big challenge, bringing all of that together," he told Newstalk.

With banks closing branches around the country, he added that Credit Unions need to become community hubs - possibly through collaborations with post offices.