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| Protecting Parity for State-Chartered Credit Unions |
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A bill to protect parity for state-chartered credit unions and clarify the Depository Institutions Deregulation and Monetary Control Act (DIDMCA) was introduced this week by Sen. Bernie Moreno, R-Ohio, and Rep. Warren Davidson, R-Ohio. The American Lending Fairness Act of 2026 would protect export rights of state-chartered credit unions and banks.
The DIDMCA allows state credit unions and banks to export their home-state interest rates across state lines. The bill seeks to address a 2023 Colorado law that would impose the state’s interest rate and fee limitations on out-of-state, state-chartered institutions that lend to Colorado borrowers, but leave federal credit unions and national banks preempted.
“The American Lending Fairness Act of 2026 is a smart, practical step toward modernizing the rules that govern how credit unions serve their members. We appreciate Senator Moreno and Congressman Davidson for recognizing that outdated and overlapping requirements ultimately increase costs for consumers. Credit unions exist to expand opportunity, not navigate unnecessary complexity,” said America’s Credit Unions President/CEO Scott Simpson. “When policymakers streamline the framework, it allows credit unions to devote more time, resources, and capital to helping families buy homes, finance small businesses, and manage everyday expenses. America’s Credit Unions strongly supports this legislation and looks forward to working with Congress to ensure it delivers meaningful benefits to the communities credit unions serve.”
America’s Credit Unions also joined a joint letter of support for the bill and outlined concern for the Colorado law.
“Colorado’s proposed interpretation of DIDMCA presents immense threats to American consumers, small businesses, and the institutions that serve them,” the letter reads. “Similar actions by other states would reduce access to credit for consumers, particularly subprime borrowers who rely on affordable small-dollar loans, credit cards, and other short-term financing products to make ends meet.”
The letter notes Colorado’s law runs counter to Congressional intent when enacting DIDMCA, which was to prevent discrimination against state-chartered, insured financial institutions, and “the legislative history further confirms that Section 525 of DIDMCA was intended to permit states to reimpose usury limits only on loans made within the state by that state’s own state-chartered institutions—not to impose those limits extraterritorially on institutions chartered in other states.“
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