League Monitoring Interest Rate Discussion at NCUA’s April 20 Board Meeting

The NCUA board will be briefed on the federal credit union interest rate ceiling and issue a request for information on climate-related financial risk at its April 20 meeting. Your League urged NCUA to consider increasing the fixed rate cap or adopting a floating rate cap.

The Federal Credit Union Act provides a default interest rate limit for federal credit union loans of 15%, and permits the NCUA Board to increase the rate cap if certain conditions are met. It has been 18% since the late 1980s, most recently renewed in January.

“Your League will be watching this discussion closely given recent developments and our current rate environment,” said League Chief Advocacy Officer JT Blau. “Federally chartered credit unions will continue to offer consumer-friendly loan products, but they need the flexibility to price those loans appropriately based on lending risk and the current rate environment.”