NCUA was the sole federal financial regulator not to adopt guidance that would increase minimum payments on credit cards because the agency didn't believe CUs were part of the problem the guidance sought to resolve.
The guidance ensures that consumers are able to pay off their credit card debt in a "reasonable" time frame using the minimum payments. High interest rates and fees have put some consumers in the position of being negatively amortized when they make the minimum payment.
But part of the CU difference is that they look out for their members' best interests, NCUA said.
"NCUA has not has not issued guidance regarding credit card minimum payments for credit unions issuing their own credit cards," the agency told The Credit Union Journal. "Federally insured credit unions have consistently demonstrated an ability to properly manage any risks associated with credit card portfolios and NCUA is confident credit unions will continue to maintain these positive trends."
Moreover, the regulator said its existing examination process is sufficient to address any problems with how a CU manages its card portfolio.
"Credit union officials exercise their fiduciary responsibility to establish minimum payment requirements for credit card portfolios that are in the best interest of their members. If officials were not appropriately fulfilling these responsibilities, we would address the situation through the examination process," NCUA said. "We have not seen evidence of erosion in credit quality or loan losses and therefore have not implemented mandated minimums. Although NCUA does not plan to issue any guidance on this particular issue at this time, we will continue to monitor and develop appropriate guidance if necessary."
