WASHINGTON—Following a rule related to field of membership proposed during the February NCUA board meeting, both credit union trade associations have now offered their feedback to the agency on where they would like to see changes made.
Among other things, the NCUA proposal seeks to make changes to underserved areas that multiple common bond federal credit unions may seek to add to their FOMs, aims to streamline existing application requirements, and is meant to clarify the role of data and criteria relating to underserved areas.
In NAFCU’s letter, Regulatory Affairs Counsel Dale Baker offered the association’s support for the proposed rule, but also asked for adjustments to the rule:
- Maintain the Chartering and Field of Membership Manual’s standalone secondary member groups for surviving spouses, rather than combining it with the group that encompasses other immediate family and household members
- Extend the proposed six-month secondary member eligibility timeframe for other immediate family and household members to 24 months
- Amend the manual’s existing secondary member groups for honorably discharged veterans to include both honorably discharged veterans and members of their immediate family or household
- Strengthen the proposal’s addition of a fifth affinity group for paid employees of a legal entity headquartered in a federal credit union’s community or rural district by expanding it to also include remote students and remote worshippers
- Further reform credit unions’ ability to add underserved areas to their FOMs and support legislative efforts to do so
- Modify the proposed rule’s provisions related to community charter applications and conversions to make the standardized community charter request application available only as an option for prospective applicants and continue to have the option to submit a free-form narrative application
CUNA’s Perspective
Meanwhile, CUNA told NCUA it believes the proposed field of membership changes would reduce unnecessary burdens and increase efficiency in the FOM application process.
“Today, the archaic FOM restrictions to which credit unions are subject are antithetical to the goal of financial inclusion and economic equity, and they impede credit unions more fully fulfilling their statutory mission to promote thrift and provide access to credit for provident purposes,” the letter reads. “We consistently urge Congress to relax or eliminate these restrictions. This proposed rule represents an important step toward a more inclusive approach to credit union membership. CUNA strongly supports this proposed rule, as the changes contemplated would help credit unions deliver necessary financial services to more Americans.”
Specific Points
In its letter, CUNA expressed support for portions of the proposal that would:
- Eliminate the need to submit redundant or less useful information and providing a standard form for business and marketing plans
- Eliminate the business and marketing plan requirement for certain federally insured state-chartered credit unions that seek to convert to a federal charter while serving the same community FOM
- Expand the community-based FOM affinities to recognize the growth of telecommuting and remote work for companies headquartered in a community
- Better capture the ongoing bond between individuals within a field of membership and their immediate family members following the death of a member
- Correct unintended consequences of prior rules, including a provision that may prevent credit unions from expanding into certain underserved rural areas
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