A recent article in American Banker got it wrong when it questioned the National Credit Union Administration’s actions to modernize credit union field-of-membership rules, wrote Jim Nussle, CUNA president/CEO, in response to that column Tuesday.
Specifically, the article challenged the NCUA’s new interpretation of the term “community.”
“The advents of the internet and of social media have fundamentally and irrevocably altered the way we think about communities,” Nussle wrote. “Ultimately, geography no longer dictates where we work, how we socialize or how we build relationships with one another.”
It’s only logical, then, he said, that financial services providers be allowed to deliver products and services in a way that keeps pace with the changing dynamics of our society.
Nussle further noted that the Federal Credit Union Act hasn’t been meaningfully updated in nearly 20 years, and that if credit unions are to remain competitive, laws must be updated to reflect the realities of the 21st century.
Conversely, credit unions should not be subject to a law that “hems them into an outdated structure envisioned during the Great Depression,” he added.
“As Klein wrote in his article, credit unions were founded to promote thrift among members and to create a source of credit for provident or productive purposes,” Nussle said. “Modernizing field-of-membership rules would not change this; it would not change the purpose of credit unions.
“It’s our communities that have changed.”