A new report on credit unions show that they continue to face financial challenges in terms of income generation and return on assets due to the low interest rate environment and high cost metrics.
But the report from the Central Bank said that on a positive note, the credit union sector continues to demonstrate a strong overall reserves position.
The report shows that credit unions' total investments increased by 58% from 2011 to 2019 to €12.5 billion, mainly due to increased member savings.
But average returns on investments have been in steady decline, decreasing from 3.1% in September 2012 to 0.9% by September 2019.
The number of credit unions overall has reduced since 2011, falling from 406 to 241 this year.
The Central Bank said that according to credit union sourced data, combined membership totals about 3.4 million.
The credit unions' total assets also continue to expand, growing by 31% from €14 billion in 2011 to €18.3 billion this year.
Today's report also shows signs of a change in loan portfolio profiles, with increased levels of longer-term lending and a net increase in the total value of new loans advanced since late 2015.
It noted that the current sector loan to asset (LTA) ratio averages 28%, while the sector's cost-income ratio has risen from 46% to 86% between 2011 and 2019.
Registrar of Credit Unions Patrick Casey said the trends highlighted in the Central Bank's latest financial conditions statistical release reflect the significant challenges that credit unions have faced over the 2011 to 2019 period, due to a changing nature of retail financial services and the low interest rate environment.
"Going forward, as those challenges will likely persist, credit unions need to take greater ownership of their business model development in order to achieve sustainability for members," Mr Casey said.
"Irish credit unions continue to enjoy the loyal trust of members. This trust, coupled with the sector's co-operative member-centric ethos, remains a competitive difference upon which to evolve business models and meet ongoing commercial and competitive challenges," he added.