WASHINGTON,, D.C (May 12, 2025) |
As the Independent Community Bankers of America (ICBA) convene in Washington, D.C. this week, the Defense Credit Union Council, DCUC, has delivered a clear message to Capitol Hill: credit unions—especially those serving our nation’s military—are indispensable to America's financial strength and resilience.
DCUC challenges misleading narratives and reminds of the vital role credit unions serve in empowering military families, underserved communities, and the broader economy.
“With growing rhetoric from the banking industry aimed at discrediting credit unions, it’s critical that lawmakers have the full picture,” says Anthony Hernandez, DCUC President/CEO. “Credit unions exist solely to serve their members, not shareholders. In the case of defense credit unions, that means delivering affordable, tailored financial services to military personnel and their families, often under circumstances traditional banks are unwilling or unable to address.”
DCUC Chief Advocacy Officer Jason Stverak highlighted a recent 2025 economic impact study that reinforces this point: eliminating the tax exemption would trigger an estimated $266 billion GDP loss, 822,000 job cuts, and $234.6 billion in added consumer costs over the next decade.
“Ending the exemption wouldn’t hurt the big banks—it would hurt everyday Americans, especially those in uniform,” says Stverak.
DCUC noted that while critics often frame credit unions as enjoying an unfair tax advantage, they forget to mention how banks received more than $447 billion in tax breaks under the 2017 Tax Cuts and Jobs Act—16 times the fiscal impact of the credit union exemption. Many banks also operate under Subchapter S or use advanced tax accounting to avoid corporate income taxes entirely.
DCUC’s correspondence also shared that in 2023, credit unions still paid $36.3 billion in payroll, property, and state taxes—a far cry from the “free ride” narrative pushed by the ICBA.
DCUC’s correspondence addressed additional rhetorics led by bank lobbyists, one of which is the ICBA frequently citing credit union acquisitions of community banks as signs of “mission drift.” Yet, these transactions challenged by the ICBA are in reality transparent, regulated, and
often initiated by community banks themselves—looking for succession plans or relief from regulatory burdens. DCUC reminded that credit unions step in to serve, not to dominate, and most importantly, preserve access to financial services in local markets.
“These are not hostile takeovers,” says Stverak. “They’re lifelines for communities that would otherwise lose their local institutions.”
High-visibility sponsorships and naming rights have also been used as a means to attack credit unions and their role as member-based and community-focused institutions. DCUC emphasizes these are strategic marketing investments, funded by member-approved budgets—not taxpayer
dollars. The goal: strengthen brand visibility in a market dominated by massive national banks, while delivering value back to members through better rates and lower fees.
A Competitive Force for Good
DCUC noted that credit unions represent just 7% of financial industry assets; even the largest credit unions are dwarfed by the top U.S. banks.
But their competitive presence delivers broad market benefits…
DCUC shared how a 2025 study found $26.9 billion in direct benefits to members, and $10.5 billion in indirect savings to bank customers, thanks to credit union-driven competition.
The return on public investment? A $2.9 billion federal exemption generated $297 billion in economic output in 2023—a ratio few other government policies can match.
Defending Military Financial Readiness
Many credit unions have long dedicated their institutions to serving the needs of military and veteran members who face unique financial stressors—whether its frequent relocations, deployments, overseas assignments, transitions to civilian life, increased risks to scams and fraud, or less access to capital as aspiring entrepreneurs. These institutions, “defense credit unions,” meet those needs often with zero-interest emergency loans, early pay programs, financial counseling designed for service members, and much more.
“Military families don’t turn to Wall Street for financial advice,” says Hernandez. “They turn to their local financial institutions, defense credit unions who provide on-base financial education courses, host outreach events, and show their support and appreciation for these communities.”
Rather than weaken these mission-driven institutions, DCUC calls on lawmakers to: • protect and uphold the historic federal tax exemption for credit unions
- oppose overreaching regulations like applying the Community Reinvestment Act (CRA) to not-for-profit cooperatives
- reject recent and any future punitive proposals, including so-called “exit fees” on bank acquisitions
“These aren’t just policy debates. Real people—service members, working families, rural residents—stand to lose if we get this wrong,” says Stverak. “Credit unions represent service over profit, people over shareholders, and community over quarterly earnings. Now is the time to defend them.”
For more information, please contact Jason Stverak at jstverak@dcuc.org and visit dcuc.org/advocacy.