WASHINGTON–The Defense CU Council is urging the Treasury Department to ensure credit unions play a role in supporting and implementing the new $1,000 financial accounts that will be offered to all newborns in the U.S. during 2025 and 2028.

As the CU Daily has been reporting, the new accounts are expected to create a new way to build a long-term relationship with a member—while simultaneously creating a highly competitive new marketplace.

The funds are included as part of the Creating Hope and Opportunity for Our Babies and Toddlers (CHOBAT) Act, which was included in the recently passed reconciliation bill.

The program is to be administered by private financial institutions under Treasury oversight.

“…At numerous U.S. bases and installations abroad, the on-base credit union is the primary (sometimes sole) banking facility available to military families,” the DCUC letter reads. “If credit unions are fully integrated into the baby accounts program, a young military family stationed in a remote location or overseas will still have ready access to open and manage their newborn’s $1,000 Trump Account through the local on-base credit union. This ensures the program truly achieves universal coverage. 

‘Overlooked’ by Banks

“Additionally, credit unions have deep experience serving populations that might be overlooked by larger for-profit banks – including lower-income and rural families, as well as junior enlisted servicemembers,” DCUC continued in its letter. “By leveraging our existing presence and relationships in these communities, Treasury can increase uptake of the newborn accounts and make the program more inclusive.”

DCU President and CEO Tony Hernandez said the initiative presents a transformative opportunity to invest in the future of children.

“As not-for-profit financial cooperatives, credit unions are uniquely positioned to deliver this benefit to military families, including those stationed overseas or in remote locations where credit unions may be the only financial institutions available,” Hernandez said in a statement.

Benefits of Including Credit Unions

According to DCUC,  including credit unions will:

• Ensure universal access, especially for military families in remote or overseas locations.
• Leverage existing infrastructure to efficiently manage custodial accounts, including compliance with Section 408(a) of the Internal Revenue Code
• Provide low-fee, high-trust services focused on maximizing the long-term value of each $1,000 account.
• Offer financial education as children grow, helping families make the most of their savings when the funds become available at age 18.