The Point: Dec. 31, 2013

 

Holiday schedule: The Credit Union Association of New York, its Affiliates and the New York Credit Union Foundation will be closed tomorrow in observance of New Year’s Day. The Point will not be published. Happy New Year!


Friday is last call for MORE Report submissions

This Friday, Jan. 3, is the deadline to submit information for the Credit Union Association of New York’s MORE Report. The report will be distributed to all New York credit unions and legislators next spring, and highlights will also be shared with the media.

Using the Association’s online reporting form, credit unionists can submit information about their 2013 efforts in the areas of: adult financial education; community investment and outreach; customized products and services; financial counseling; immigrant outreach; Volunteer Income Tax Assistance (VITA); and youth financial education.

For additional information about the MORE program, visit the Association website.


CUNA added to upcoming interchange oral arguments

CUNA and its partner members of The Clearing House coalition will present oral arguments Jan. 17, as the ongoing debit interchange case moves to the U.S. Court of Appeals for the District of Columbia Circuit. The court ruled Friday that CUNA and The Clearing House members will be allowed to present their views, along with the Federal Reserve and the merchants group, during the oral arguments for the Fed’s appeal to uphold its rule.

The case involves a challenge from a merchants’ coalition claiming the Fed’s implementation of the debit interchange cap as required under the Dodd-Frank Act is too high. CUNA has stated that the cap is too restrictive and does not factor in enough of the costs that card issuers face for providing their services.

The current Fed debit interchange fee cap limits fees for issuers with assets of $10 billion or more to 21 cents and allows an additional five basis points per transaction to be charged to cover fraud losses. An extra penny may be charged by financial institutions that are in compliance with established fraud prevention standards.

The interchange regulations, overturned by a lower court, remain in effect as the court case moves forward on the Fed’s appeal.


CUNA Mutual Group article outlines social media policies

CUNA Mutual Group recently published a new article intended to help credit unions develop pre-emptive social media policies and procedures. The article encourages credit unions to create a social media policy that is similar to a lending operation, with set strategies and parameters.

According to the article, credit unions should address five key areas when drafting a social media policy, including:

  • Ownership/authority: The policy must establish a specific point person with the authority and ability to engage and respond to members promptly.
  • Metrics: While social media success isn’t necessarily as quantitative as most day-to-day operations, a way to measure success should be put in place.
  • Tone: It’s imperative that a social media policy addresses how and when the tone of social media posts will differ from the tone used elsewhere in the credit union.
  • Compliance: Regulators have stated that existing consumer protection and compliance laws and regulations apply to social media. Therefore, compliance, operational, third-party and reputation risks must be properly addressed.
  • Continuous monitoring and follow through: Social media should be viewed as a living, ever-evolving tool that needs continuous monitoring. Even the social media policy itself should be reviewed and updated often to keep up with rapidly changing technology.


Low-income designated credit unions pass 2,000 mark

More than 2,000 credit unions across the country now carry the low-income designation, according to NCUA Chair Debbie Matz. The group has a combined total of nearly 20 million members and $176 billion in assets.

Low-income credit unions are often the only insured depository institutions serving low-income and underserved areas. To qualify as a low-income credit union, a majority of the federal credit union’s membership must meet low-income thresholds based on 2010 Census data. The designation offers several benefits to credit unions, including:

  • an exemption from the statutory 12.25 percent cap on member business lending, which expands access to capital for small businesses and helps credit unions diversify portfolios;
  • eligibility for Community Development Revolving Loan Fund grants and low-interest loans;
  • ability to accept deposits from non-members; and
  • authorization to obtain supplemental capital.

For more information about the low-income designation, view NCUA’s Low Income Designation Fact Sheet.

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