Rule Changes Give Credit Unions a Recruiting Boost
U.S. credit unions may soon be able to attract millions of new members as formerly restrictive membership rules are relaxed.
The National Credit Union Administration (NCUA) – the body that regulates the nation’s federal credit unions – last week approved a plan to ease restrictions on memberships, and essentially put CUs on a more equal footing with banks.
Among the rules being eased are geographic limits on credit union membership and others that restrict recruiting by employer-affiliated CUs.
Basically, CUs will be able to cast a wider net when recruiting new members.
According to an NCUA release, the new rules update key definitions and make more than a dozen changes to NCUA’s chartering and field-of-membership rule for federal credit unions by:
- Allowing greater flexibility to community charter credit unions in how they define the local communities they serve;
- Providing credit unions with better opportunities to serve underserved areas by updating the process for defining those areas;
- Enhancing access to credit union services for residents of rural areas by allowing rural district credit unions to serve up to 1 million people;
- Streamlining paperwork for multiple common-bond credit unions that seek to serve additional groups, such as including independent contractors with a strong dependency relationship with an employee group; and
- Expanding credit union access for honorably discharged members of the armed services by allowing them to join credit unions serving their active-duty counterparts.
These changes should help to boost the credit union movement in the years ahead.
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