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 Public and private bills, private laws), or to the general public (Public and private bills, public laws). For a Bill (law) ...

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), also known as a nonbusiness entity, nonprofit institution, not-for-profit organization, or simply a nonprofit, is a non-governmental (private) legal entity organized and operated for a collective, public, or so ...

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

credit unions A credit union is a member-owned nonprofit cooperative financial institution. They may offer financial services equivalent to those of commercial banks, such as share accounts (savings accounts), share draft accounts ( cheque accounts), credit ...

. This Act established the federal credit union system and created the

Bureau of Federal Credit Unions The Bureau of Federal Credit Unions was a federal agency in the United States that supervised and chartered federal credit unions from 1934 until 1970. The Bureau was created through the Federal Credit Union Act as part of the New Deal. It was sel ...

, the predecessor to the

National Credit Union Administration The National Credit Union Administration (NCUA) is an American government-backed insurer of Credit unions in the United States, credit unions in the United States, one of two agencies that provide deposit insurance to depositors in U.S. deposi ...

, 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 of which it is a part. It is used when the constituent components of a federation are themselves called states. Federations made up of provinces, cant ...

, a system known as

dual chartering Dual chartering refers to the system by which credit unions in the United States can be chartered under either of two governmental authorities; by either the federal government or by the state government.Rubenstein, JimDual Chartering Becomes Nebras ...

, 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 Franz Hermann Schulze-Delitzsch, also Hermann Schulze, (29 August 1808 – 29 April 1883) was a German politician and economist. He was responsible for the organizing of the world's first credit unions. He was also co-founder of the German Progre ...

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 U ...

Pierre Jay Pierre Jay (May 4, 1870 – November 24, 1949) was the first chairman of the Federal Reserve Bank of New York. Early life Jay was born on May 4, 1870, in Warwick, New York. He was the son of Rev. Peter Augustus Jay (1841–1875), a protestan ...

and

Roy Bergengren Roy F. Bergengren (June 14, 1879 – November 11, 1955) was an American attorney and pioneer of the United States credit union movement. Hired by Edward Filene in July 1921 to head the Credit Union National Extension Bureau, Bergengren carried ou ...

. 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 regulatory law, regulations promulgated by the executive departments and agencies of the federal government of the ...

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

See also

References

External links