Across the nation, more people are choosing credit unions for their banking needs, with total shares and deposits rising by 6.3% to $1.86 trillion over the first three quarters of 2022, according to the National Credit Union Administration. Introduced by Senator Kyrsten Sinema, the Credit Union Board Modernization Act seeks to make it easier for all Arizonans — particularly in rural areas — to access services from local branches to purchase homes and obtain credit.
The bipartisan legislation would allow qualifying credit unions to expand their core offerings by lowering the required frequency of board meetings, which must meet monthly under federal law.
“Credit unions tend to be smaller than traditional banks, and they have fewer staff,” Sinema explains. “Convening and running a successful board meeting requires a lot of time and operating expenses for both preparing and running the meeting.”
The goal of this legislation is to ease the burden on “credit unions that have demonstrated high performance and met all metrics,” Sinema continues. Board meetings would still be required, though the exact number depends on the circumstances of each institution.
Smaller and rural communities would benefit most from the passage of the Credit Union Board Modernization Act since credit unions are often the only institutions serving those areas.
“The reality is most folks in rural Arizona don’t have access to one of the big four banks, so credit unions provide the largest stability and the greatest service for rural Arizonans,” Sinema says. “Credit unions do more than just checking, credit or deposit services. They also help people with buying a home, purchasing a car or investing in their education.”
In a statement, Dan Berger, president and CEO of National Association of Federally-Insured Credit Unions, writes, “This critical legislation will allow credit unions more flexibility and time to devote attention to serving their 135 million members while helping disadvantaged, underbanked communities who need access to affordable financial products and services. We urge the Senate to quickly pass this legislation.”
GoWest Credit Union Association and Credit Union National Association also support the proposed legislation.
“I met with over 30 representatives of Arizona credit unions just this week in Washington, DC,” Sinema concludes. “These are credit unions that represent small businesses, families, and importantly, rural Arizonans. This [issue] is something I hear about regularly from our constituents, both from customers and those who serve customers in rural parts of Arizona.”