Americans Living Paycheck to Paycheck Are Served Well by Credit Unions, Report Says

PEWAUKEE, Wis., Nov. 15 /PRNewswire/ — The top federal regulator of credit unions affirmed in a report released today that America’s credit unions continue to fulfill their mission of serving the needs of 87 million working Americans.

The National Credit Union Administration based its report on data and information it collected during the past year from almost 450 credit unions nationwide.

“The report concluded that credit unions are meeting the needs of people seeking to improve their lives but who live largely paycheck to paycheck,” said Brett Thompson, President & CEO of The Wisconsin Credit Union League, the trade association representing 270 not-for-profit, member-owned financial institutions.

The report also found that compensation for credit union chief executives is far below that of bank CEOs; the average credit union chief earned just $77,490 in salary and benefits in 2005. Sixty percent of the federal credit union CEOs examined had total compensation of $75,000 or less while eighty percent made below $100,000 in total compensation.

“Not-for-profit credit unions aren’t lining executives’ pockets — they’re doing right by the working people who rely on them,” Thompson added. “Credit unions’ mission is to serve members, and that’s what the report said they’re doing.”

Thompson says this news comes as no surprise to credit union members or Wisconsin credit unions, which pioneered efforts and continue to develop and promote services to financially underserved or unbanked individuals as part of their REAL Solutions initiative. As part of that effort, credit unions identify trends or needs that are affecting individuals and families, and the communities they live and work in, and then develop services to meet members’ needs.

For example, as part of the REAL Solutions program credit unions make small loans to help people establish or re-build creditworthiness; provide affordable alternatives to high-cost payday loans; offer low-cost check cashing to people without a prior account relationship; deliver free financial seminars on everything from budgeting to home buying; offer lower-cost wire services to help new Americans; work with more than 50 Wisconsin elementary, middle and high schools to promote financial literacy; team with counties and local agencies to provide low-cost loans that keep people on the job or in school; and during tax time, open accounts into which tax refunds can be direct deposited — a fast, no-cost alternative to costly “refund anticipation loans.”