Streamlining Field of Membership Expansion Will Hurt Small Credit Unions Say Community Bankers


Following the NCUA Board’s February approval of a proposal streamlining the field of membership application process, the change is now coming under fire by community bankers.

The change not only addresses questions regarding remote work as it relates to fields of membership, but also reduces impediments to the application process by simplifying documentation responsibilities. And while the Board voted unanimously to accept the proposal, board member Rodney Hood felt it could have gone yet further saying, “Personally, I believe the best way to do this is to allow mobile phones to serve as service facilities. For us to continue to use an antiquated definition of service facility is not responsible in my view.”

The Independent Community Bankers of America (ICBA), however, are apparently looking out for the best interests of small credit unions. In a letter written to the NCUA, Vice President and Regulatory Counsel Michael Emancipator urged the NCUA to reconsider. “ICBA is concerned that, if finalized, these changes will further enable growth-obsessed, national credit unions to either acquire credit unions in rural markets, or leverage their size to the detriment of existing credit unions and locally-based financial institutions in those markets,” Emancipator wrote.

“While this proposal is certainly a windfall for large credit unions that are able to capitalize on economies of scale and aggressive growth, it should be more soberly viewed as just one more avenue toward the consolidation of the credit union marketplace, or at the very least, a greater proliferation of super-large credit unions that have a national presence,” he added.”

Credit union trade groups such as NAFCU and CUNA on the other hand are pleased with the changes that in their opinion modernize the NCUA’s outdated rules regarding field of membership, bringing them closer to the level of faster moving state-chartering organizations.

Skepticism at the ICBA’s intentions aside, their complaints do raise a good point about whether the NCUA has a responsibility to protect the industry from further consolidation, and how they might balance modernizing regulations for the digital age with protecting local credit unions from being overrun.


  • Esteban Camargo

    As a supervising editor of CUSO Magazine, Esteban reviews and edits submissions, assists in the development of the publishing calendar, and performs his own research and writing. His experience provides CUSO Mag with a seasoned writer and content curator, able to provide valuable input to contributors, correspondents, and freelance journalists. Esteban has worked at CU*Answers since 2008 and currently serves as the CUSO's content marketing manager.

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