WASHINGTON—The Defense Credit Union Council is pressing Congress to modernize deposit insurance protections, calling it a critical step to safeguard small businesses and strengthen local economies.
In a letter to Senators Bill Hagerty (R-TN) and Angela Alsobrooks (D-MD, DCUC’s Chief Advocacy Officer Jason Stverak commended the recent amendment to the FY2026 National Defense Authorization Act, which proposes to raise deposit insurance coverage on business transaction accounts to $20 million for community financial institutions.
“This proposal closes a dangerous gap for small businesses,” says Stverak. “Payroll and operating funds must be safe and available, even during financial instability.”
In the letter, Stverak highlighted three priorities as Congress considers reforms:
- Protect Small Business Deposits: DCUC noted that higher coverage for operating accounts ensures businesses can meet payroll and essential expenses
- Maintain Parity: DCUC stressed that credit unions must have equal authority as banks through the National Credit Union Administration (NCUA)
- Pair Reform with Lending Relief: DCUC voiced its continued support for the bipartisan Veterans Member Business Loan Act and recommends Congress lift or ease the outdated cap that limits credit unions’ ability to serve local businesses
“Veteran entrepreneurs deserve full access to capital, and credit unions are uniquely positioned to provide it,” says Stverak. “By coupling stronger deposit protections with expanded credit opportunities, DCUC believes Congress can safeguard small businesses while fueling local economic growth.”
DCUC Opposes SB675
Separately, the trade group expressed its strong opposition to Puerto Rico Senate Bill 675, which seeks to exclude sales taxes and gratuities from interchange fee calculations.
“SB 675 would harm Puerto Rico’s financial ecosystem, especially servicemembers, veterans, and their families who rely on safe, convenient, and affordable payments through their local financial institutions including credit unions,” said Stverak.
DCUC relayed key concerns presented with SB 675, including undermined payment security; a costly and complex Puerto Rico-specific technology mandate; disproportionate impact on smaller financial institutions (through limited resources and higher costs); shifted compliance expenses to consumers (higher fees, reduced rewards programs, fewer resources for security); lacking potential for true public benefit (past interchange regulations have shown savings are rarely passed on to customers); and the fact that no U.S. state or global jurisdiction has enacted this type of carve-out. DCUC’s expressed that enacting this bill would isolate Puerto Rico’s financial system and likely discourage investment.
Instead of rewriting payment rules, DCUC suggested that Puerto Rico adopt proven measures—such as ensuring full tip protection for employees or providing sales tax collection allowances for merchants—without harming consumers or financial institutions.