The NCUA’s final rule that amends the credit union service organization regulation has been published in the Federal Register, and will go into effect on Nov. 26, 2021.

According to the NCUA, the final rule accomplishes two objectives: expanding the list of permissible activities and services for CUSOs to include the origination of any type of loan that a federal credit union may originate, and granting the board additional flexibility to approve permissible activities and services.

The final rule was approved by a 2-1 vote at the agency’s board of directors meeting on Oct. 21 with Boardmembers Kyle Hauptman and Rodney Hood voting in favor of the final rule. Todd Harper, NCUA chairman, voted against the rule, saying in prepared remarks that it “should come as no surprise to anyone who has followed this rulemaking that I strongly oppose the final CUSO rule before us today.”

Harper said that “there is a classic philosophical difference on this rule. On the one hand, my colleagues believe that the changes contained in this final rule will help small credit unions to compete and remain viable. On the other hand, I believe that unleashing such competition within the credit union system will lead to lower earnings for smaller credit unions because of the earnings that CUSOs will siphon off the top from participating credit unions.”

CUTODAY also reported Harper’s “strong opposition” to the rule.