CUNA hopes to work on advancing a yet-to-be-introduced bill that would afford the NCUA the ability to insure prepaid and payroll accounts. CUNA wrote to the U.S. House Financial Services subcommittee Monday regarding the bill before the subcommittee conducts a hearing to discuss it, among other bills.
“While we believe the Federal Credit Union Act affords the NCUA authority to insure prepaid and payroll card accounts, the agency has been unwilling to promulgate a rule covering these accounts,” wrote CUNA President/CEO Jim Nussle. “As a result, credit unions, many of which were formed by and serve specific employee groups, are in most cases unable to offer prepaid and payroll card services. Because NCUA is unwilling to use its existing authority, a statutory change appears to be necessary.”
Nussle added that CUNA would like to work with the subcommittee on advance legislation on this issue in the next Congress. The bill, sponsored by Rep. Scott Tipton (R-Colo.), is titled the Protect Prepaid Accounts Act of 2016.
In the letter, Nussle also thanked the committee for examining legislation that would help ensure consumer credit scored accurately reflect the creditworthiness of borrowers.
“Equally important to achieving expanded access to credit for consumers is ensuring that credit unions are able to meet their needs,” Nussle wrote. “Credit unions face many statutory barriers to member service and have suffered through a crisis of creeping complexity with respect to regulatory burden that is a leading driver of system consolidation.
“It is very important that the Subcommittee continues to consider legislation addressing consumers’ access to mainstream banking services; as you do so, we hope you also will consider legislation that will make it easier for credit unions to help consumers access credit,” Nussle added.
The hearing is scheduled for Tuesday, starting at 10 a.m. (ET).