Thursday, June 25, 2015

NCUA: Monthly Membership Fees Impermissible

The National Credit Union Administration (NCUA) issued a legal opinion letter that federal credit unions (FCUs) may not charge a periodic membership fees.

The letter was in response to my inquiry whether federal credit unions may charge monthly membership fees.

The NCUA wrote that the Federal Credit Union Act (FCUA) permits FCUs to charge a uniform, one-time entrance fee to members under Section 109 of the FCUA.

The legal opinion letter goes on to state that FCUs may also charge other fees for account services and other financial products. These fees are legally distinct from a membership fee.

However, the letter states that these fees and charges, however, may not be membership fees that serve as a condition on continued membership.

So, it will be interesting to see what NCUA does with regard to Arizona FCU's charging a $3 monthly membership fee, since the beginning of 2013.

Read the letter.

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