Removing Barriers Blog

CUNA Writes to Sanders & Ocasio-Cortez in Response to their Proposal to Allow USPS to Provide Financial Services
Posted May 09, 2019 by CUNA Advocacy

Earlier today, CUNA responded to Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez’s recent proposal to cap the interest rates consumers pay for credit card and other loans that also called for the U.S. Postal Service to start providing more affordable financial services products to consumers.   

In the letter CUNA refuted the need for such legislation, detailing why credit unions are the best option for consumers and already provide safe, affordable and quality financial services to local communities.  

Membership through a credit union provides a consumer with all the protections that Sanders and Ocasio-Cortez are seeking, including:  

  • Usury Cap: The Federal Credit Union Act (FCU Act) and National Credit Union Administration (NCUA) Board has set a usury cap of 18 percent for most financial products, including credit cards. In addition, many state-chartered credit unions are bound by state-established usury caps.
  • Broad Access for Consumers: The Shared Branching Network and other arrangements have established a wide-ranging, surcharge-free ATM network that allows credit union members to use the branches of other credit unions. This cooperative network ensures members have access their money almost anywhere.
  • Affordable Products and Services: Credit unions often provide products and services at lower rates and with fewer fees than their bank counterparts. For example, as of December 2018, credit unions’ average interest rate for classic credit cards stood at 11.61 percent compared to banks’ average interest rate of 13.47 percent.

“Congress doesn’t need to ask the postal service to something it was not intended to do. Congress should encourage all consumers — and certainly the most vulnerable — to seek out service from credit unions,” said CUNA Chief Advocacy Officer Ryan Donovan.  

While everyone cannot join the same credit union, there is a credit union for everyone to join.  As the nation’s original consumer protectors, credit unions have a long history of providing affordable, responsible access to banking services. 

The CUNA/League system has consistently advocated for solutions to help consumers access credit unions, including expanding fields of membership.  CUNA will continue to look for opportunities to work with Congress to increase awareness among unbanked consumers that options for affordable financial services are available and convenient through the credit union system.