America’s Credit Unions holds its nose to respond to the BS
By Sarah Snell Cooke, Founder/CEO, The Credit Union Connection
The American Bankers Association is that frenemy that wants to wake the sleeping baby, which is really the one in charge and makes things happen. And that’s credit unions.
The ABA-backed Morning Consult survey states that credit unions are tax-dodging, under-regulated institutions that somehow pose an existential threat to the $25 trillion banking industry.
‘Majority of U.S. Consumers Think Congress Should Hold Credit Unions Accountable,’ the headline screams. So dramatic.
America’s Credit Unions isn’t taking their sometimes-lobbying-partner’s BS.
The Survey: A Masterclass in Misleading Questions
The ABA survey claims that 67% of consumers believe Congress should re-examine credit unions’ tax exemption.
Except that 83% of respondents didn’t even know credit unions don’t pay federal taxes.
And given half of America doesn’t even know what a credit union is or does, I mean really, come on. Most people surveyed had no idea what they were being asked about.
It’s like asking someone if they think the government should investigate the dangers of dihydrogen monoxide (H2O), and then feigning surprise when respondents say yes. By framing questions to people who lack context, the banker survey is just another on the steaming pile that credit unions must defend themselves against.
As Scott Simpson, President/CEO of America’s Credit Unions, put it, “Their latest ‘survey’ is an egregious attempt to mislead policymakers and consumers; an effort to eliminate a threat to their profits.”
Sleight of hand and twist of fate
The ABA shows off its creativity by lumping credit unions in with ‘nonbanks,’ like fintechs, and asks everyday consumers whether businesses providing “bank-like services” should follow the same rules as banks. Of course, we all know that credit unions are regulated similarly to banks.
Similarly, not identical, because, for instance, credit unions never did the brazen redlining that banks did, so, no, CRA isn’t imposed upon credit unions. Hell, banks give to credit unions directly or indirectly to actually DO the CRA work and earn the credit for them, because credit unions are already doing that work anyway. And bankers wouldn’t want to get their hands dirty among us commoners.
It’s like Seattle’s Pike Place Fish Market with red herrings flying all around. The ABA’s warped sense of truth is misleading to people who don’t (and shouldn’t have to) know the intricacies of bank and credit union operations.
That does not mean what you think that means
In fact, America’s Credit Unions pointed out, when consumers actually understand credit unions, they overwhelmingly support them.
A 2025 reputable, national poll by Harper Polling and Frederick Polls found that 64% of Americans prefer maintaining the current tax exemption for credit unions. That jumps to 78% when you explain that credit unions’ not-for-profit status allows them to help small businesses grow, share earnings with member-owners and keep money in communities rather than shipping it to Wall Street.
Further, 79% agree Americans would be better off financially if more people used credit unions, and 94% approve of allowing credit unions to expand into more communities.
But let’s talk about that survey where 83% of people didn’t know what they were answering. Right? SMDH
Goliath cries about big, bad David
The ABA would have you believe credit unions are coming for banks, but credit unions represent less than 10% of the market. The two largest banks in the U.S are larger than the entire credit union industry combined, but sure, credit unions are their fiercest competitors.
Banks hold 91% of assets, 91% of deposits and 89% of loans. Credit unions are the scrappy underdog, not the menacing giant.
And here’s the kicker: according to the Conference of State Bank Supervisors’ survey, community banks overwhelmingly identify large banks and other community banks as their primary competitors, not credit unions.
Spend money to make money
Let’s talk turkey taxes.
But credit unions truly are like banks in that Subchapter S banks’ taxes are passed through to their shareholders. At a credit union, that’s the members. Credit unions’ 144 million members pay plenty of taxes: property, sales, real estate, payroll and more. The not-for-profit federal income tax exemption exists because credit unions return their earnings to members rather than shareholders. It’s baked in pie.
Congressional budget estimates put credit unions’ tax exemption ‘cost’ at $3 billion per year. However, when credit unions return $27.5 billion in direct benefits and $38.3 billion in total benefits for American consumers, it’s a brilliant investment – a 1,200% ROI!
I buy that
The ABA loves to sound the alarm about credit unions acquiring banks, but no one is threatening them into selling. Those banks decided it was the best path for their shareholders, plus Banks sell to credit unions because it often results in better community outcomes, mission alignment and long-term viability.
What’s so annoying about this though is that since 2012, $1.77 trillion in bank assets have been merged. Credit unions account for just $6.5 billion, or just 0.3% of those mergers. Banks have sold to other banks more than 2,000 times during the same period. Fewer than 40 banks have sold to credit unions.
At the same time, America’s Credit Unions shared that banks have closed 20,000 branches since 2012, while credit unions have opened 650 net new branches. Only 10% of credit unions have over $1 billion in assets, yet they operate more than half of the 900 credit union branches in areas that would otherwise be banking deserts.
Yeah, these aggressive credit unions are a major crisis.
The Real Questions the ABA Should Ask
America’s Credit Unions offered up some pointed suggestions for the ABA’s next survey:
How about asking consumers if, knowing the four largest U.S. banks paid a combined $150 billion in fines and settlements for fraud, rate-rigging, and illegal foreclosures all while receiving hundreds of billions in taxpayer bailouts, they think Congress should investigate why banks still enjoy special protections?
Or maybe ask if consumers would like to pay almost $9 billion more in fees because credit unions were eliminated, or if they’d prefer access to safe, affordable financial services?
Or: “Each of America’s four largest banks now holds more assets than the entire $2.4 trillion credit union industry combined, yet somehow the banking lobby still spends millions every year telling Congress that not-for-profit credit unions are the real competitive threat. Knowing this, which comes closest to your view?
- It’s adorable that trillion-dollar megabanks are scared of member-owned co-ops that give the profits back to military members, teachers, and nurses
- No, credit unions are clearly an existential danger to yacht maintenance funds
- Don’t know / I’m still laughing too hard to answer”
What, me worry?
The ABA’s survey demonstrates one thing: banks are worried about credit unions. Not because credit unions are doing anything wrong, but because they’re doing something right. They’re serving communities banks would never enter, keeping money in those historically ignored and disadvantaged communities, and providing competition that steps on the neck of bank fees that would be jettisoned immediately if credit unions didn’t exist.
Credit unions aren’t the threat to economic freedom; they’re the embodiment of it. And the ABA can’t change that.
What do you think about the ABA’s latest survey? Drop your thoughts in the comments.