New York Credit Union Association leadership met with U.S. Senate Majority Leader Chuck Schumer’s office late last week to discuss the Credit Card Competition Act of 2023 and the SAFE Banking Act of 2023, which would carve a path for credit unions to provide financial services for the cannabis industry.
Association staff was joined by Linda Armyn (chief strategy & marketing officer, Bethpage Federal Credit Union), P. Trish Shermot (director, Government Affairs/Regional Urban Development, Visions Federal Credit Union), Frank DeGraw (president/CEO, Sunmark Credit Union), and Clement Abonyi (director of Advocacy for Congressional Affairs, Credit Union National Association). The team of subject matter experts echoed the concerns of our federal partners in opposition to the Credit Card Competition Act of 2023 and the negative impact it will have on credit unions throughout New York state.
“Our focus continues to be the financial wellbeing of our members,” said Association President/CEO, William J. Mellin. “Credit unions have an obligation to protect the private information of their members and this act will only increase the challenges associated with doing so. Credit unions as card issuers are responsible for fraud. Whether it’s the cost of needing to reissue cards or the increased costs of fraud protection, these expenses will increase if the CCCA is passed and would ultimately impact credit union members in the form of increased fees, lower rates on deposits and higher rates on loans.”
Association and credit union staff also reinforced the point that the prior debit interchange bill (i.e., the Durbin Amendment) passed as part of the Dodd-Frank Wall Street Reform Consumer Protection Act of 2010, only increased the compliance burden on credit unions and had no impact on reducing costs for consumers as intended.
The Association also discussed Congressional activity on the SAFE Banking Act and the current issues credit unions face navigating the intricacies of the cannabis industry in New York state. Because marijuana is classified as a schedule 1 controlled substance, federally chartered credit unions cannot work with cannabis businesses in New York.
Credit unions regulated by the New York State Department of Financial Services can participate, but face similar risk and incur the steep cost of navigating this new territory due to the complicated compliance and legal issues surrounding an all-cash industry. The Association will continue to monitor the bill’s activity as it is negotiated in the Senate Committee on Banking, Housing, and Urban Affairs and will report on any developments should it be included as part of an appropriations bill.
Questions related to Association advocacy initiatives can be directed to the Association’s director of governmental affairs, Michael Colello, at michael.colello@nycua.org or (800) 342-9835 ext. 8207.