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In the media MBL cap debit fees more
MADISON, Wis. (9/7/11)--Credit unions' member business lending (MBL) cap, low fees at credit unions, and the advantages of credit unions over giant megabanks found their way into media reports the past week and a half. In an article entitled "Free the Economy, Free the Credit Unions," (FrumForum.com (Sept. 2), Eli Lehrer notes that credit unions are pushing Congress to lift the MBL cap to 27.5% of assets from 12.25%, and says a lot of members of Congress agree. "Total elimination of the cap would be much better and economically helpful idea," Lehrer said, noting lifting the cap "makes a lot of economic sense: credit unions have funds they would gladly lend to businesses at competitive interest rates if the government would simply let them do so. More business loans would create jobs and improve the economy." He added the limitation is a "good example of a burdensome and pointless regulation that holds back the economy." In PBS.org's "Nightly Business Report" (Aug. 24), a story on savings advice and options points out that consumers can "wring more value" out of savings by moving their money to a community institution or a credit union. "While rates aren't significantly higher, you'll find fewer fees and penalties, which means more money in your pocket," the article said, adding "The majority of credit unions offer free checking accounts with no strings attached. That's a good deal any time." Another article in the Orlando Sentinel Aug. 31, discusses advice by Clark Howard, host of a personal finance radio show and author of Clark Howard's Living Large in Lean Times. It notes that on banking issues, Howard urges people to think twice before doing business with "giant monster megabanks." "He likes small banks, especially consumer-friendly credit unions, known for lower borrowing rates and superior customer service," the article said. An article in the Chattanooga Times/Free Press (Aug. 31), discusses how big banks are phasing in monthly fees on debit card usage while smaller banks are taking a "wait and see" stance before making the decision whether to charge for bank card purchases. Smaller institutions fall under the Dodd Frank Act's $10 billion asset exemption, but electronic payment networks are built and owned by the big banks, the article said. One credit union CEO, Blake Strickland, of Chattanooga-based Tennessee Valley FCU, told the publication that he is expecting some ramification from the act. "Nine times out of 10, when they do stuff like this, it trickles down," he said.
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