Updating the federal credit union charter will help credit unions increase service to members and communities, CUNA President/CEO Jim Nussle wrote in CUToday Wednesday. Charter modernization is a top CUNA/League priority in 2020.
“Given our movement’s century-long mission of promoting thrift and providing access to credit for provident purposes, there are some limits on credit union operations that remain in place from the time the nation’s credit unions were helping consumers weather the Great Depression, limitations that have no place in today’s consumer finance landscape,” Nussle wrote. “By updating the federal charter, Congress can allow credit unions to better meet the growing need for local, consumer-first access to a financial institution in rural and working-class communities across the country.”
For example, Nussle notes that progress on updating both loan maturity limits and member business lending standards are helping credit unions increase service to veterans, farmers and minority and student borrowers.
“By better tailoring regulations and modernizing credit union governance to make it simpler for consumers to plant their dollars close to home, Congress has an opportunity to demonstrate a commitment to community growth. Local communities are the lifeforce of our country, and credit unions are committed to keeping those communities strong,” he wrote. “Locally grown credit union offerings support families, build consumer trust, and preserve financial diversity. It’s our communities that lose when one-size-fits-all governance forces credit unions to pull back on providing safe and affordable products.”
Credit unions made major progress on these modernizations during CUNA GAC, as three bills have been introduced this week so far, one to allow expulsion of members for just cause, another to remove outdated credit union board duties and one to modify board meeting requirements.