A community federal credit union, in the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
, is based upon the cooperative concept of traditional
credit union
A credit union, a type of financial institution similar to a commercial bank, is a member-owned nonprofit financial cooperative. Credit unions generally provide services to members similar to retail banks, including deposit accounts, provisi ...
s but differs substantially in its
scope of membership. Unlike the majority of credit unions nationally, the community credit union is based upon geographical membership and not worksite or union commonality.
The very first such credit union in the United States was founded in 1970 in
Isla Vista, California (
Santa Barbara County
Santa Barbara County, California, officially the County of Santa Barbara, is located in Southern California. As of the 2020 census, the population was 448,229. The county seat is Santa Barbara, and the largest city is Santa Maria.
Santa Barba ...
) as a direct result of the burning of a branch of
Bank of America
The Bank of America Corporation (often abbreviated BofA or BoA) is an American multinational investment bank and financial services holding company headquartered at the Bank of America Corporate Center in Charlotte, North Carolina. The bank ...
. Initial organizers and members of the credit union Board of Directors included Wanda Michalenko,
Matthew Steen, David Vaughn, Charlie Jones, David Bearman and others.
This modest founding model later grew into community organizing against redlining and the eventual passage of the
Community Reinvestment Act
The Community Reinvestment Act (CRA, P.L. 95-128, 91 Stat. 1147, title VIII of the Housing and Community Development Act of 1977, ''et seq.'') is a United States federal law designed to encourage commercial banks and savings associations to hel ...
in the State of California and other states that currently allow government reserves and other municipal funds to be transferred into
CUNA-insured local credit unions as an alternative to full-service banking institutions. The first actual transfer of government funds in the United States occurred with the Isla Vista Community Federal Credit Union when the Associated Students of the
University of California, Santa Barbara
The University of California, Santa Barbara (UC Santa Barbara or UCSB) is a public land-grant research university in Santa Barbara, California with 23,196 undergraduates and 2,983 graduate students enrolled in 2021–2022. It is part of the U ...
transferred part of its financial reserves from the
Bank of America
The Bank of America Corporation (often abbreviated BofA or BoA) is an American multinational investment bank and financial services holding company headquartered at the Bank of America Corporate Center in Charlotte, North Carolina. The bank ...
in 1977.
[The Goleta Sun 12-10-77]
See also
*
Credit union service organization
Credit union service organizations (CUSOs) are corporate entities in the United States that are owned by federally chartered or federally insured, state chartered credit unions.
Under US federal law and the National Credit Union Administration ...
*
Credit union
A credit union, a type of financial institution similar to a commercial bank, is a member-owned nonprofit financial cooperative. Credit unions generally provide services to members similar to retail banks, including deposit accounts, provisi ...
References
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Credit unions of the United States