NCUA Under Fire and Thoughts Turn to Trends for 2017

Posted By: Elizabeth Rowe | December 15, 2016 | 0 Comments

For the first time anyone can remember, two banking associations are simultaneously suing the NCUA. The Independent Community Bankers group is suing about business lending and the ABA is suing about changes to FOM. Each association has tag teamed and filed an amicus brief in the other’s lawsuit.

Banking and credit union groups are lobbying Congress to reject any regulations coming from the CFPB before the installation of the new administration.

Apple Pay rewards are coming and they are using a partnership with Blackhawk to make prepaid and loyalty cards available to Apple Pay users. An advantage of the Blackhawk program is that it incentivizes merchants to participate.

And as an FYI, news posts will probably be quite brief until the new year. No one likes to announce anything too fabulous when everyone’s focused on end-of-the-year books, strategies and budgeting followed by a focus on egg nog and alpine skiing.

Borrowing grows at a slow pace

8 December 2016, Los Angeles Times

The Federal Reserve’s newest Consumer Credit release shows that after burning through credit for the past 4 months, American consumers have slowed their rate of new debt assumption in October.

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Trends That Could Influence Credit Unions in 2017

8 December 2016, Credit Union Times

Per Ted Bilke of Symitar, credit unions will be affected by the following trends in 2017:

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BECU Sees Membership Spike After Eliminating Minimum Balance Requirement

8 December 2016, Credit Union Journal Online

Sometimes, making a small gesture can get a disproportionate response: When BECU rolled its new account deposit requirement from $5 to $0 and reimbursed existing members their $5 membership fee, it didn’t really affect any initial deposits or create any challenges with a sudden surge in the number of inactive accounts. But rather, existing members took to social media to say how impressed they were by the CU’s gesture and “members are depositing and using their accounts within the first 30 days of membership at a slightly higher rate than before.”

Bill Pay, Mobile Deposit Among the Most Popular Features of Banks’ Mobile Apps

December 8, 2016, Digital Payment News

New Celent research is a survey of finserv vendors, processors and CUSOs that assesses the popularity/ubiquity of a variety of mobile banking products. With smaller FIs beginning to offer mobile banking apps, penetration of mobile banking is now at 57% of FIs. Of those FIs offering a mobile payment within their banking app, the following are the most popular:

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However, while payments are popular, Celent found that the most ubiquitous of mobile banking features were views of account balances (100%), account transfers (98.7%) and transaction histories (94.4%).

Apple, Blackhawk Network partner on Apple Pay rewards

5 December 2016, PaymentsSource

Apple and Blackhawk are partnering to make branded gift/loyalty cards and rewards programs compatible with Apple Pay. Blackhawk will operate as a “pass provider for merchants by adding these forms of branded value into Apple Pay.” “The partnership allows consumers to make the payments through their iPhones or the Apple Watch, while simultaneously earning rewards and loyalty points at participating merchants.”

Can Zelle Trump Venmo in P2P Exchanges?

6 December 2016, Credit Union Journal Online

PayPal’s Venmo has been a clear leader in the P2P space but it charges its users 3% for credit card transactions. The bank head-to-head competitor in the space is Zelle which can debit and credit a member’s account in real time and does not charge for its transactions. (Appearing in Friday Focus for the second time this week), BECU has been using the PopMoney since 2009 and offers the service gratis for standard ACH and charges $2 for next-day delivery of payments. Ten percent of BECU’s members are enrolled in the program and enrollees average 40,000 to 50,000 transactions per month. The crediting, or rather the slow crediting, of payments has been a sticking point with members: “Consumers should only have to care about who they need to pay, how much and by when. The attractiveness of truly having real-time money movement will drive usage and adoption of the service.”

Banks Open Second Front in Assault on NCUA

8 December 2016, Credit Union Journal

The ICBA has already filed a suit against the NCUA challenging its authority to expand the member business lending so that loans or loan participations made to non-members no longer count against the 12.25% asset cap that reins in CUs participation. The ICBA points to 7 banks that have lost $50M in loans to CUs. The ICBA is filing an amicus brief in support of another suit that has been filed by the ABA. The ABA, which returned the amicus brief favor by supporting the ICBA’s lawsuit, is challenging the NCUA’s regulations that help rationalize the growth strategies of CUs (new rules make it easier for CUs to assemble broad service areas and may raise the population limits on the membership fields from 2.5M to 10M.

Congress Should Overturn Any Forthcoming CFPB Rules, Industry Groups Say

7 December 2016, Credit Union Journal Online

The Congressional Review Act is a seldom-used oversight tool that Congress may use to overturn a rule issued by a federal agency. And that agency is the CFPB and the groups lobbying Congress to reject CFPB rules are from the Fin Serv industry. Congress is being urged to reject any rules “governing arbitration, payday lending, debt collection and prepaid cards.” Oh, and while Congress is focused on the CFPB, FIs would also like the body to eliminate the sole-director organization in favor of a five-member commission for the agency.

Elizabeth Rowe

Elizabeth Rowe

Elizabeth tracks the shifting payments landscape for both PSCU and its member owners. Focusing on the interstice of the economy, competition, consumers, technology, payment products and channels and regulatory guidance, Elizabeth gleans the key challenges and opportunities facing our industry, our strategic plans and our success fulfilling our mandate of serving the American consumer.
Elizabeth Rowe

 


 

 
 
 

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