How to Charter a Credit Union
Credit unions are non-profit organizations and provide similar financial services as banks for lower fees. Credit unions are membership-based and are owned by their members. The process to charter a credit union will include a formal request and a business plan.
- Create a committee board of directors to start a credit union. Pick people who have a financial background.
- Decide on a common bond for membership in the credit union. A common bond is required for a credit union charter and it can be based on employment, location, religion or other associations. Develop a survey for potential credit union members and see if there is enough interest in the common bond to start a credit union.
- Figure out whether to seek a charter as a basic or full service credit union. Many new credit unions start out as a basic service credit union because of the lower start-up costs. Basic service credit unions offer personal checking accounts, savings accounts and small loans to customers. Full-service credit unions offer more advanced services like business accounts, retirement accounts and check cashing services.
- Contact the regional National Small Credit Union Program (NCUA). The NCUA will provide technical assistance and training for people starting credit unions. The NCUA are the ones that grant charters for credit unions.
- Calculate the start-up costs for office space, equipment and third-party services. Include the salaries for staff and management that will run the credit union in the business plan.
- Develop the business plan. Include information from the survey of potential customers in a section titled "Common Bond." Provide the costs and financial projections in the business plan.
- Submit a formal request for a charter along with the business plan to the regional NCUA for evaluation and they will decide to approve or deny the charter.