RICHMOND, Va. (1/23/14)--With the support of state credit unions, a prize-linked savings (PLS) bill passed the Virginia House of Delegates Wednesday by 97-0 vote.
In addition, a state Senate version of the bill is expected to pass as early as today, the Virginia Credit Union League reported.
"Our credit unions have done a wonderful job in Richmond lobbying for our legislation," said Rick Pillow, league president/CEO. "This week, 80 representatives from credit unions all across the commonwealth met with their respective delegates and senators, not only on our credit union bills, but on dozens of other bills that affect our operations."
Credit unions that participated in this week's Credit Union Days at the General Assembly include:
Next week, credit unions from the Richmond, Charlottesville and Waynesboro areas travel to Richmond for their lobbying days.
The league is also tracking progress on a parity bill for state-chartered credit unions and banks, which would eliminate the need for state-chartered institutions to seek permission from the state Bureau of Financial Institutions to place or relocate ATMs. The league asked that the measure be introduced and state-chartered banks have since joined credit unions on the legislation.
"We view this bill as elimination of red tape for state-chartered credit unions, which could have found themselves at a competitive disadvantage in placing ATMs in prime locations," said Pillow.
Prize-linked savings programs are intended to boost the country's annual savings rate--around 4.1% (News Now Dec. 12). Through these products, credit union members and others can receive entries into a cash prize sweepstakes for depositing a certain amount of money into their savings accounts. The programs have appealed to unbanked and under-banked consumers who were not previously inclined to save money.
In December, the U.S. Senate passed legislation that would allow credit unions and other financial institutions nationwide to offer PLS accounts.
President Barack Obama signed the American Savings Promotion Act into law Dec. 18.
Ten states allow prize-linked savings programs: Connecticut, Indiana, Maine, Maryland, Michigan, Nebraska, New York, North Carolina, Rhode Island and Washington.