What Credit Unions Face

In today’s regulatory environment, many financial rules are set at the international level.

National regulators often have limited discretion to deviate from international standards once they are finalized. Much of this framework is designed to address the needs of large and internationally active banks, and is not intended for smaller institutions such as credit unions. The framework often does not contemplate the not-for-profit cooperative structure. 

This is important because the incentives of each institution are quite different. Credit unions are inherently less risky and do not need the sophistication of regulation that the large banks require.

Therefore, many of the regulations adopted for large banks are not appropriate or necessary for smaller, domestic credit unions.

What We Do

World Council of Credit Unions is the only trade association advocating on behalf of credit unions in front of key international standard setting bodies, including the: 

• Basel Committee on Banking Supervision (Basel Committee);
• Financial Action Task Force (FATF) oversees AML/CFT regulations;
• International Accounting Standards Board (IASB);
• Financial Stability Board (FSB); and
• International Association of Deposit Insurers (IADI).

World Council's International Advocacy work has succeeded in reducing regulatory burdens for credit unions in the areas of prudential regulation, anti-money laundering, taxation and accounting standards.

A Record of Success

Our policy successes include:

• Influencing the Basel Committee on Banking Supervision to emphasize that a proportional approach to supervision be clearly communicated with national-level supervisory authorities to prevent credit unions from facing unfair regulatory burden in key areas such as operational resilience and stress testing.
• Advocating successfully for the G20 Brazilian Presidency to include language in its Leaders Declaration that emphasizes the importance of financial inclusion in improving financial well-being and harnessing digital technologies to reduce inequalities.
• Advocating for and receiving updated guidance and support from the Financial Action Task Force (FATF) regarding key anti-money laundering issues related to a credit union's ability to serve their community.
• Advancing the visibility of the global credit union movement’s regulatory challenges with key international standard setters, including FATF’s Private Sector Consultative Forum, the United Nations Department of Economic and Social Affairs (UN DESA) Expert Group Meeting, and ongoing meetings with representatives from the European Union
  
• Obtaining favorable language from the Financial Stability Board (FSB) on cybersecurity issues, including proportionality and regulatory burden reduction for smaller community-based financial institutions in the Recommendations to Achieve Greater Convergence in Cyber Incident Reporting.
  
• Successfully advocating for a change to Ecuador's Basic Account Rule, allowing migrants and refugees to open credit union accounts and receive debit cards using an ID from their home country.
• Successfully advocating for Ukraine to pass amendments to the Law on Credit Unions that eliminated the need for credit unions to obtain a separate license to provide payment services.
• Influencing North Macedonia's parliament to change the country’s Banking Law, allowing credit unions to offer better and more diversified services to members.
• Engaging with key European Union (EU) officials and select Members of the EU Parliament in Brussels, Belgium on exempting credit unions from the Financial Data Access Regulation (FiDA).