CUNA contacts Sanders, AOC highlighting benefits of CU difference
The best option for consumers to access high-quality, affordable financial services are the credit unions in their communities, CUNA President/CEO Jim Nussle wrote to Sen. Bernie Sanders (I-Vt.) and Rep. Alexandria Ocasio-Cortez (D-N.Y.) Thursday. The two legislators recently announced a proposal expanding the duties of the U.S. Postal Service (USPS) to include offering financial services and products.
“There is no need to pass legislation requiring the USPS to provide products and services it wasn’t designed to provide. Instead, we urge you and others in Congress to use your public platform to encourage all consumers, especially the most vulnerable among us, to seek out financial services from a community-based, not-for-profit credit union,” Nussle wrote. “As the nation’s original consumer protectors, credit unions have a long history of providing affordable, responsible access to banking services.”
Nussle notes that credit unions already provide consumers with all the protections contained in the legislators’ proposal, including:
- A usury cap set by the Federal Credit Union Act (FCU Act) and NCUA at 18% for most financial products, including credit cards. In addition, many state-chartered credit unions are bound by state-established usury caps;
- Broad access for Consumers through the Shared Branching Network and other arrangements that establish a wide-ranging, surcharge-free ATM network allowing credit union members to use the branches of other credit unions. This cooperative network ensures members have access their money almost anywhere; and
- Affordable products and services, as credit unions often provide products and services at lower rates and with fewer fees than their bank counterparts. For example, as of December 2018, credit unions’ average interest rate for classic credit cards stood at 11.61% compared to banks’ average interest rate of 13.47%.
“Congress and credit unions can work together to increase awareness among the unbanked that options for affordable financial services are available and convenient through the credit union system. A part of that effort would be getting the truth out about credit unions: while everyone cannot join the same credit union, there is a credit union for everyone to join,” the letter reads. "CUNA has advocated for solutions to help consumers access credit unions, including reduced regulatory burden, increased authority for credit unions to expand product offerings, and increased ability to expand fields of membership into areas in need of high-quality financial services. If the door to a credit union was open a bit wider, then the underserved and unbanked would be a lot better off."