The Irish League of Credit Unions has confirmed that its controversial project to develop a new central computer infrastructure for the movement has run out of funds, leading to job losses.

The ISIS project, which is being managed by a wholly owned subsidiary of the league, has stalled pending a decision on its future which will be taken at a special general meeting of the league in Limerick next month.

In the meantime, the ILCU subsidiary running the project has issued protective notice to eight of the 11 staff working on the computer initiative because it no longer has the funds to pay them.

Those affected are mainly training and implementation staff who would have installed the system and trained credit union members in its operation.

The project has been dogged by controversy since it became evident last year that it had significantly overrun its budget.

It is now expected to cost £68 million (€86.4 million) rather than the original projection of £40 million.

A review of the undertaking was then agreed and this was now nearing completion, the spokesman said.

The project has provoked sharp divisions within the credit union movement.

A number of member unions - many of which supported ISIS by paying either a £10 or £20 levy per member toward its development - have threatened legal action if the league's support for the project affects their individual union members.

ISIS, an integrated computer system, was designed to link the entire credit union movement and allow it to offer a range of electronic banking services.