The majority of US consumers think credit unions should be subject to the same regulations as banks.
A survey by Morning Consult on behalf of the American Bankers Association (ABA) found 80% of Americans agree that any business providing bank-like services to consumers should have to comply with the same rules and regulations.
After almost 20 years since Congress examined whether credit unions are providing enough community benefit to warrant their existing tax exemption, 62% of respondents were in favor of Congress reexamining the issue, while only 14% opposed it.
Robert Flock, ABA’s vice president of strategic engagement, said: “Since Congress last convened a hearing on the credit union tax exemption in 2005, the credit union industry has undergone a metamorphosis.
“Credit unions have a congressionally mandated mission to prioritize service to lower and middle income communities; however, they increasingly prioritize growth by advocating for changes to membership rules, raising money from investors, and even buying banks.”
The survey also highlighted a widespread lack of understanding among Americans of the differences between a bank and a credit union.
Only 18% of respondents knew that credit unions do not pay federal taxes, and nearly a third of consumers incorrectly thought they do pay them.
Almost half of respondents, 49%, believe credit unions should pay federal taxes just like banks, compared to just 18% who feel they should not.
The ICBA recently called for Congress to investigate credit union tax exemptions after five deals involving credit unions acquiring local community banks were announced in one week.