Welcome to 2025, dear reader! If you’re anything like me, you have most likely been busy this last week taking down the holiday decorations, setting resolutions, reminiscing about all the great moments in 2024, and winding down after months of holiday events, gatherings, and preparation. The relatives have returned home, the twinkle lights have come off the house, and there are finally a few moments of peace and quiet.

At this point, it can be quite tempting to slow down, take a break, and revel in the fantastic work of the last few months. And while the rest is most certainly deserved, don’t rest for too long, for the new year has the potential to bring large policy shifts and organizational reform to the financial sector landscape as we head into a new administration later this month.

With the CFPB poised to fight an uphill battle with its new rulings, AI guidelines finally hitting the shelves, and our industry’s largest event on the horizon, the first few months of 2025 will have plenty of industry news, so let’s glance forward at where our industry has its eyes set for the year and what your credit union should be in the know on.

CFPB going to battle against the new administration

As 2024 was an election year, we are entering 2025 with a new Congress—the 119th to be exact—as well as a new Presidential Administration, starting on January 20th. While large, sweeping changes may not occur straight away, it’s good to keep informed on what this might mean for credit unions. To start, the CFPB was busy in the last few months of 2024, issuing new rules and policies related to overdraft, interchange, and credit card late fees.

While the Biden Administration was supportive of the CFPB’s efforts against these so-called “junk fees,” members of the new administration have been more critical of the CFPB, with some calling to reform or remove it altogether. Vivek Ramaswamy, who has been appointed by the incoming president to co-lead the newly formed Department of Government Efficiency (DOGE), recently called for the abolition of the CFPB after its overdraft ruling, claiming the organization was pushing its authority past limits.

“The new administration can and should nullify this overreach, but we must go further: this latest gambit of the CFPB is just a symptom of a deeper (and unconstitutional) cancer of unelected bureaucrats substituting their policy judgments for those of Congress,” Ramaswamy said. “That’s un-American and needs to end.”

Working alongside Ramaswamy in co-leading the new department is Elon Musk, who—in much fewer words than his counterpart—also called for the end of the agency, simply stating on his platform X to “Delete CFPB. There are too many duplicative regulatory agencies.”

Arguments that the CFPB is overextending its power and unfairly enforcing decisions made by unelected bureaucrats have long been talking points of the agency’s opponents, including credit union advocacy organizations such as America’s Credit Unions. In fact, such rhetoric was a major takeaway from the industry’s largest event, the Governmental Affairs Conference, in March of last year, and ACU is already working with other entities to push back on the recent CFPB rulings, filing a lawsuit in hopes of blocking them.

With CFPB Director Chopra most likely exiting the CFPB soon, administration changes on the horizon, legal battles in play, and strong opposition from the industry, it is possible we could see these new rules altered in some way or completely blocked altogether. While credit unions should still prepare for these rules to be put into place and have a plan for if they are, I’d wager we will see some big decisions falling in the first few months of the year.

We here at CUSO Magazine will, of course, be the first to let you know when and how these changes come, but credit unions should keep their eyes and ears open for news on the topic and be prepared for either outcome.

Data privacy and AI laws and regulations incoming

Artificial intelligence and its capabilities have been all the rage for the last two years, and credit unions are experimenting with how this technology can be incorporated into their daily operations both safely and effectively. When AI was originally introduced, there were little to no guidelines on how to best implement it and no laws restricting its application, which led to a number of lawsuits and accusations of misuse and biased results. Credit unions were not immune to these legal issues, especially as they often go hand-in-hand with data privacy laws (which were also few and far between).

This lack of regulation left courts scrambling to issue rulings (such as the ruling the companies are responsible for what their AI chatbot says) and those using the tech struggling to keep up. Navy Federal Credit Union famously came into hot water last year for both accusations of lending bias through its automated underwriting system as well as using AI to monitor customer calls without their consent. While recording customer calls is a legal and well-known practice, Navy Federal was working with a third-party AI to record, store, and mine data from the calls—often for the AI’s own learning and without clear consent from the callers to allow the third party access to this data.

While the lawsuit was eventually dropped, it highlighted the clear need for strong and consistent guidelines around AI. As America’s Credit Union’s President/CEO Jim Nussle said in a letter to Congress last year regarding AI, “It is critical that there are clear rules of the road so that Congress and regulators are better informed when approaching the balance between an environment for innovation to flourish and our ability to meet the financial needs of our members.”

As of now, the federal government has laid down a few guidelines by which to use AI, when the Biden administration issued the “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence,” but with incoming changes, it is thought that this could be repealed sooner rather than later. However, should the repeal succeed, it will not be the only safeguard around AI use, as states are now working to pass AI legislation on their own. Last year, 45 states introduced legislation of some kind regarding AI (even if just to establish a task force or look into the technology more) and 31 states passed those bills. Effectively, this means credit unions will need to keep up with both state and federal legislation around AI.

Data privacy, which as we mentioned before often goes hand-in-hand with AI, in terms of what data it can have access to and what consent needs to be serviced from the member in order to allow access to such data, is also increasing legislation. While the US’s current laws fall short of standards in other countries, many steps are working to add more safeguards. In 2025 alone, eight more states will adopt such measures. Meaning even if something is permissible under AI law, it might not be under new data privacy laws: see the Navy Federal case.

While none of this is meant as a means to discourage experimenting with AI and finding useful ways to bring the technology to your credit union, it does serve as a notice that policy and regulation surrounding the technology are shifting quickly and often and will continue to do so come the change in administration. Whether the restrictions are lessened and states implement their own policies or guidelines are upheld at a national level, your credit union should be aware of these moving parts and which guidelines—both federal and state—they’ll need to follow.

And in the meantime, review where your organization is currently utilizing this technology and determine if any such applications could be construed as misuse. There are many intricacies within data privacy laws that could apply to AI, so pay close attention to how those two might intersect in your credit union’s daily operations.

Governmental Affairs Conference coming in March

Speaking of America’s Credit Unions and the Governmental Affairs Conference, we’d be remiss not to discuss the upcoming event, which will be hosted in Washington D.C. from March 2-6th. With the fledgling organization celebrating the successful completion of its first full year, it is heading into its second GAC with great fanfare.

The theme for 2025 is “Together We Move – Moving with purpose. Moving with passion. Moving with strength,” which, according to ACU, “reflects the unity and determination you’ll help shape as we work together to improve financial well-being across the nation.”

Additionally, just this week, America’s Credit Unions released a list of its priorities for the upcoming year, and while many of them kept focus on fighting back against the CFPB and the attack on fee income, the organization made it clear it is also looking to expand credit unions’ reach and opportunities available via technological innovation and increased product offerings. You can find the list in its entirety in the shared press release.

As we head into GAC season, we can expect that many of these priorities (namely the regulatory changes and CFPB discussions) will be significant talking points at the upcoming conference for both America’s Credit Unions and invited speakers, who previously included members of Congress and the NCUA. In reference to the topics we mentioned above, which may or may not see significant shifts in policy as a result of a new administration coming in just a few short weeks, it’s likely by March we will have more information on how these changes may play out, which will also likely be covered at the event.

Policy isn’t changing tomorrow

While keeping track of all of these potential changes, new rulings, and shifting policies can feel overwhelming—especially since it’s too early to tell exactly how much of it will stick and how much will fall to the wayside—it’s good to remember it won’t all come at once.

While intentions may be declared in the coming months, it’s more likely policy changes won’t take effect until later in the year or even next. And as we mentioned before, we here at CUSO Magazine will be covering all of this and more in the next few months to make sure your credit union is as up-to-date as possible, so keep your eyes peeled!