Over the past few weeks, consumers have put their anger with the banking industry into action. Protests on Wall Street that have begun to spread across the country, and some readers of this blog have said they plan to close their accounts if and when their banks begin to roll out new fees. Based on many readers' comments, it seems credit unions will soon be welcoming your business.
This got me thinking: Are credit unions prepared for a huge uptick in their membership?
I spoke with Debbie Matz, board chairwoman of the National Credit Union Administration, and it turns out credit unions don't need to prepare for the membership surge. It's already happening. From Chairwoman Matz:
Credit unions have been handling a large influx of new members for several years, as many consumers move money from stocks and other uninsured investments. In fact, since the economic downturn began in late 2007, credit union membership has risen 5 percent from less than 87 million to more than 91 million. Going forward, NCUA remains committed to maintaining the safety and soundness of the credit union industry through effective regulation and supervision.
The NCUA is essentially the credit union equivalent to the Federal Deposit Insurance Corp., or FDIC. The administration supervises all federal credit unions and insures each deposit up to $250,000. If millions of account holders at some of the nation's biggest banks make good on their promises to part ways due to new bank fees, the NCUA may see a big acceleration in those already-rising membership numbers.
Now, I don't expect we'll be dealing with 100 million account holders abandoning the banking industry tomorrow, but even a small chunk could dramatically change the financial industry. I think we're on the cusp of seeing that change, too.
As account holders begin to understand some of the perks available at credit unions, big banks may not seem so much better anymore. With convenient options such as shared branch networks and the CO-OP ATM network, credit unions may be on the verge of some massive growth.
What are your thoughts? Have you begun comparing credit union options?