The CUNA research and policy analysis team had a busy 2022. We were firmly focused on collecting and using data to bring your stories to life and highlight the credit union difference at the national level.
We spent much of the year on offense, illustrating how credit unions advance the communities they serve and provide true financial inclusion.
As part of that work, we geocoded financial institution branches and mapped underbanked and unbanked communities nationwide to support efforts to broaden credit unions’ fields of membership (FOM) and business lending. We fended off threats to overdraft protection and interchange, and fought to ensure bank owners maintain their ability to sell their institutions to member-owned credit unions, updating our comprehensive white paper on this topic.
Our team championed the expansion of credit union public deposit authority and prepared detailed, customized reports for several state Leagues, which clearly show that a credit union option for financial services is good public policy.
Increasing choice in the marketplace improves convenience, provides greater competition, and strengthens at-risk communities by ensuring community financial institutions lend local funds locally.
The end result is improved service satisfaction and higher returns on deposited funds for trustees of the public’s money.
We assisted with national research on this topic and explored credit union mortgage lending trends in Home Mortgage Disclosure Act data.
We also prepared national- and state-level analyses for several League partners to guard against misguided attempts to expand Community Reinvestment Act provisions into the credit union arena.
More broadly, we continued efforts to measure and socialize the financial benefits of credit union membership, which totaled $13.5 billion in direct financial benefits to members and more than $5 billion to nonmembers in the 12 months ending June 2022.
This means credit unions collectively leveraged their $2 billion income tax advantage by a factor of more than nine—making this one of the best investments policymakers convey to average Americans.
We also measured our national economic impact, which shows credit unions provide full-time employment for roughly 330,000 people and account for 1 million jobs within the U.S. economy. Collectively, credit unions generate nearly $210 billion in economic output.
They also contribute $12.8 billion in federal tax revenues and $10.6 billion in state and local tax revenues. Beyond this, credit union members paid $1.8 trillion in state and federal income taxes in the most recent tax year.
CUNA Senior Economist Ligia Vado summarized the financial benefits and economic impact in a series of web-based, interactive dashboards that will soon be available to all credit union advocates. Users will be able to drill down from the national data to explore state and congressional district-level data.
Data-based proof points are increasingly important in our advocacy work.
Analyzing Equifax data
We also obtained a 10% sample of historical Equifax data, with more than 28 billion records. Senior Economist Dawit Kebede took the lead in organizing, cleaning, and exploring this data.
His analysis shows that credit unions are consumers’ best choice for financing automobile loans.
Specifically, his work shows credit unions:
Punch above their weight with a whopping 30% auto loan market share.
Have a consistent mission focus, which is reflected in a subprime share of total originations that’s 1.5 times higher than the share banks report.
Price in more consumer-friendly ways, resulting in thousands of dollars in lower interest payments for individual borrowers.
Reflect more resilient borrowers with fewer financial disruptions, including substantially lower 60-day delinquency rates than consumers who use banks or finance companies.
Kebede developed a comprehensive, exploratory dashboard and introduced a monthly credit union auto lending review, which will serve as a springboard for a regular cadence of interactions with both the trade and popular press. The dashboard is coordinated with state-level data that allows League partners and member credit unions to leverage their own information and messaging within their unique fields of membership.
Kebede also harnessed Equifax data to more accurately estimate where credit union members reside, making analysis at county, congressional district, and other political subdivision levels more reliable. He does this by distributing the NCUA Call Report’s 130 million memberships geographically based on the Equifax distribution of member borrowers.
NCUA aggregates call report membership totals at the credit union headquarters level, so each institution’s total membership appears in only one state. The Equifax data allows us to distribute millions of members from large, multistate credit unions to the states where members actually reside.
Credit Union Magazine’s Spring 2023 issue features the 2023 Credit Union Heroes and examines CUNA-League advocacy priorities, board leadership, the impact of financial well-being efforts, fee-related compliance issues, predictions for the year ahead, and more.
