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| NCUA extends 18% Interest Rate Ceiling to September 2027 |
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The NCUA Board approved continuing the current 18% interest rate ceiling for loans made by federal credit unions through Sept. 10, 2027. America’s Credit Unions has called on the NCUA to maintain the ceiling before it reverted to 15% in March.
The Federal Credit Union Act limits federal credit union interest rates to 15%, but the NCUA Board may establish a temporary rate of up to 18% for up to 18 months. The 18% ceiling has been in place since May 1987. Friday's announcement is the 25th time the board has voted to maintain it.
“Maintaining the NCUA’s 18% interest rate ceiling is about preserving access to responsible, affordable credit for consumers. As a result, credit unions are able to serve borrowers who would otherwise be pushed into far more expensive and less regulated alternatives,” said Scott Simpson, America’s Credit Unions president/CEO. “The NCUA has maintained this ceiling for decades, recognizing that allowing the cap to revert back to 15% would not lower costs for consumers. Rather, it would restrict access to credit, particularly for working families who rely on credit unions for safe, fairly priced loans. The NCUA’s authority to maintain the 18% ceiling provides stability, protects consumers, and ensures credit unions can continue fulfilling their mission as financial cooperatives that serve people, not profits.”
NCUA staff analysis determined the statutory criteria was met for the NCUA Board to maintain the interest rate ceiling at 18%.
A Friday letter to federal credit unions (26-FCU-02) contains details.
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