Credit unions are the ideal not-for-profit banking alternative
We’ve got this. Credit Unions have been offering a community-driven option to banks for more than 100 years.
LONE TREE, CO (May 14, 2019) — A new bill introduced on Thursday, May 9, includes suggestions to turn post offices into a public option for financial services and consumer lending in an effort to serve our working class communities.
I was speechless. Well, not really. I tweeted a response to the legislators sponsoring the bill right away offering to elaborate on the incredible “Credit Union Difference.” We’re right here! Credit unions are already the ideal not-for-profit banking alternative providing affordable financial services within communities around our nation.
Introduced in a joint statement by Sen. Bernie Sanders (I-VT) and Rep. Alexandria Ocasio-Cortez (D-NY), the bill has been called the Loan Shark Prevention Act and touts protecting consumers from predatory lending practices, capping interest rates, and making financial services more accessible to rural locations. “The USPS should fully exercise its existing statutory authority and implement pilot programs offering affordable financial services, including ATMs, paycheck cashing, bill payment and electronic money transfers in post offices,” said the joint statement. With 31,000 federal post offices listed, that might sound great, but we’ve got this covered already with our cooperative credit union network sharing resources across our great country.
There’s already a solution to this proposal. Credit unions were formed more than 100 years ago with the goal of serving working class Americans. We are not-for-profit, member-owned cooperatives providing lower loan rates and higher savings rates to the average person. We are the alternative to predatory lending. Our cooperative culture means we work together when times get tough to ensure that our members always come first, through financial literacy and low borrowing rates.
Credit unions have protections and options in place that supersede what this new bill proposes, including:
- Average lending rates are lower at credit unions than at banks, according to the National Credit Union Administration’s (NCUA) March 2019 data. Classic credit cards averaged only 11.82% at credit unions compared to banks average rate of 13.65%.
- An existing usury cap of 18% for most financial products, including credit cards, set by the Federal Credit Union Act (FCU Act) and NCUA. Many state-charted credit unions are also bound by state-established interest rate caps.
- More than 30,000 ATMs nationwide offering surcharge-free transactions through the credit union’s Shared ATM Network.
We work to help people afford life every day at Canvas Credit Union, and embrace being a financial by-your-side guide for our members. In 2018, Canvas Credit Union helped our members obtain access to more than $2.1 billion in affordable loans. We’re still opening eyes each day to all that credit unions have to offer. And we won’t stop. Let’s continue to grow this great movement that is already rolling forward to the benefit of everyday Americans.
President & Chief Executive Officer
Canvas Credit Union
About Canvas Credit Union
Canvas Credit Union (Formerly Public Service Credit Union) is a safe and insured financial institution with over $2.9 billion in assets and more than 256,000 members. Canvas provides a full array of financial products and services, including savings, checking, loans, mortgages, and online and mobile options. Serving Colorado communities for more than 80 years, Canvas currently has 29 branches. Visit us at http://canvas.org