Off the Record, On the Issues with John

​Credit unions remain strong, but a shifting regulatory and risk landscape makes staying engaged more important than ever.

By John Alexander, DakCU Director of Legislative & Regulatory Affairs
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Several issues are moving at once in the credit union world, and they matter for Dakota credit unions. The broad picture is fairly simple. Credit unions remain financially sound overall, but they are operating in a policy environment that is shifting quickly. The National Credit Union Administration (NCUA) is continuing its deregulation work, fraud and compliance concerns remain front and center, and credit unions still need to stay alert on bigger federal fights like tax status and interchange.

The newest NCUA system data shows the industry is still on solid footing. At the end of the fourth quarter of 2025, federally insured credit union assets reached $2.43 trillion, up 5.4 percent from a year earlier. Loans rose to $1.72 trillion, up 4.6 percent year over year. That is important because it shows credit unions are still growing, still lending, and still serving members even after several difficult years of rate pressure, liquidity concerns, and broader economic uncertainty.

At the same time, NCUA has been steadily rolling out deregulation proposals. Most recently, the agency announced another round of proposed changes tied to chartering and field of membership. The proposal would ease some of the existing barriers for certain associational groups and give NCUA more room to review applications based on the full facts rather than a narrow automatic test. For credit unions, especially those that care about future growth and charter flexibility, this is worth watching closely.

NCUA also kept those issues in front of the Board this week. The April 9 board agenda included briefings on brokered and reciprocal deposits, the agency’s broader deregulation project, and its strategic plan. That tells us this is not a one-off item. The agency is continuing to look at how its rules are structured and where it believes changes can be made.

Fraud remains another major issue. Credit unions continue dealing with rising fraud risks, and trade groups are pressing for targeted fixes that give institutions more ability to protect members. One recent example is a request for changes under Regulation E that would allow account identifiers on periodic statements to be limited further. The basic idea is straightforward. If less account information is exposed, there is less useful information available to bad actors. This may sound like a small technical issue, but it connects directly to real fraud prevention.

The anti-money laundering area is also seeing movement. NCUA, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) recently requested comment on a proposed rule tied to the Anti-Money Laundering (AML) Act of 2020. The agencies are looking at a more risk-based approach to AML and countering the financing of terrorism compliance programs. That would not remove BSA obligations, but it could help push supervision toward higher-risk activity and away from a more check-the-box approach.

Digital asset policy is still developing too. Earlier this year, NCUA proposed a framework related to permitted payment stablecoin issuer applications. For most Dakota credit unions, stablecoins are not an immediate business priority. Still, this shows where financial services policy is headed. Faster payments, digital asset oversight, and questions about who gets to participate in new payment systems are no longer fringe topics. Regulators are putting them into formal rulemaking channels.

On Capitol Hill, the tax issue remains one of the largest long-term concerns. The immediate pressure may not feel as intense as it did during earlier fights, but the issue has not gone away. Credit unions should assume the tax status debate can return whenever Congress starts looking for offsets or revenue. That means advocacy cannot become passive simply because the latest round ended without a direct hit.

Interchange is another issue that remains alive. Proposals like the Credit Card Competition Act continue to raise concern because of what they could mean for payment revenue, fraud controls, and the overall member experience. These debates are often framed as merchant issues in Washington, but the effect reaches credit unions quickly. When interchange revenue is squeezed, the pressure shows up elsewhere in operations, service delivery, and product value.

The larger takeaway is this: credit unions are in a stable position financially, but the operating environment around them is still moving. Rules are changing. Proposals are advancing. Old fights are still capable of coming back. Dakota credit unions should stay engaged, track these developments closely, and be ready to speak up when the stakes are real.

That is the real story right now. The credit union system is holding strong, but the policy and regulatory ground under it is still shifting.
 
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