The amended CUSO Rule, passed last week by the NCUA Board, was published in the Federal Register today, giving the updated CUSO Rule an implementation date of November 26, 2021.
On October 21, Board Members Rodney Hood and Kyle Hauptman showed real leadership at the monthly the NCUA Board of Directors meeting by passing an amendment to the federal CUSO Rule (Part 712). We have worked with the NCUA Board for many years to modernize the CUSO Rule and allow credit unions to leverage their collaborative partners in all types of lending to their members.
The amended Rule now permits CUSOs to originate any type of loan a credit union is permitted to originate. These loans can be sold or participated to a credit union, or held by a CUSO. The change modernizes the CUSO lending powers, allowing CUSOs to be a valuable collaborative partner to credit unions in all types of lending.
“This rule gives credit unions the tools to compete more effectively in the digital marketplace,” said NCUA Vice Chairman Kyle Hauptman. “It also gives members another choice when shopping online. That’s a good thing.”
“I believe this rule will help credit unions, and in particular, mid-size and smaller credit unions, stay relevant in the years ahead by continuing to grow and scale in the cooperative spirit while insuring the industry is responding to the rapidly changing lending landscape,” said NCUA Board Member Rodney Hood. “I view today’s rule as a significant milestone for Credit Union Service Organizations, but our work here is not done with regard to CUSO investments. I look forward to addressing this in the future with my Board colleagues.”
In addition, the NCUA Board amended the process for adding new permissible services in the future eliminating the need to amend the CUSO to do so. This will provide the agency with a more streamlined approach to approving new permissible services and help to keep CUSOs relevant in the highly competitive environment in which CUSOs serve credit unions and their members.
We appreciate the support that other industry trade groups have provided on this important initiative, and we especially appreciate the forward thinking leadership that NCUA Board Members Hood and Hauptman have shown in supporting this long-awaited modernization of CUSO powers.
