The Federal Credit Union Act is an

Act of Congress An Act of Congress is a statute enacted by the United States Congress. Acts may apply only to individual entities (called private laws), or to the general public ( public laws). For a bill to become an act, the text must pass through both house ...

enacted in 1934. The purpose of the law was to make

credit Credit (from Latin verb ''credit'', meaning "one believes") is the trust which allows one party to provide money or resources to another party wherein the second party does not reimburse the first party immediately (thereby generating a debt) ...

available and promote thrift through a national system of

nonprofit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...

cooperative A cooperative (also known as co-operative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically-contro ...

credit unions 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, provision ...

. This Act established the federal credit union system and created the Bureau of Federal Credit Unions, the predecessor to the

National Credit Union Administration The National Credit Union Administration (NCUA) is a government-backed insurer of credit unions in the United States, one of two agencies that provide deposit insurance to depositors in U.S. depository institutions, the other being the Feder ...

, to charter and oversee federal credit unions. The general provisions in the Federal Act were based on the Massachusetts Credit Union Act of 1909,Presently codified at Mass. Gen. Laws ch. 171, §§ 1-84 (2008) and became the basis of many other state credit union laws. Under the provisions of the Federal Credit Union Act, a credit union may be chartered under either federal or

state law State law refers to the law of a federated state, as distinguished from the law of the federation A federation (also known as a federal state) is a political entity characterized by a union of partially self-governing provinces, states, o ...

, a system known as dual chartering, which is still in existence today. Credit union law in the U.S. built on earlier legislation such as that developed by Franz Hermann Schulze-Delitzsch in Germany and Alphonse Desjardins in Canada. Among the individuals responsible for formulating credit union legislation in the United States were

Edward Filene Edward Albert Filene (September 3, 1860 – September 26, 1937) was an American businessman and philanthropist. He is best known for building the Filene's department store chain and for his decisive role in pioneering credit unions across the Un ...

, Pierre Jay and Roy Bergengren. The Act is amended periodically to evolve and remain a modern credit union law. This contemporary law, coupled with the NCUA Board's commitment to reduce regulatory burden, enables federal credit unions to offer a variety of services to meet the financial needs of their members. For example, in addition to basic passbook share, many federal credit unions offer share drafts, share certificates, and credit cards. Federal credit unions organized and operated in accordance with the Federal Credit Union Act are considered entities of the United States government and are tax-exempt under savings accounts.

References

External links

Federal Credit Union ActPDFdetails
as amended in the GPObr>Statute Compilations collection

National Credit Union Administration
(Title 12, Chapter VII) in the

Code of Federal Regulations In the law of the United States, the ''Code of Federal Regulations'' (''CFR'') is the codification of the general and permanent regulations promulgated by the executive departments and agencies of the federal government of the United States. ...

{{Bank regulation in the United States History of banking in the United States 1934 in law Credit Union Act New Deal legislation

See also

References

External links