WASHINGTON–The Defense Credit Union Council (DCUC) has formally requested that NCUA extend the current temporary 18% interest rate ceiling for federal credit union loans beyond its scheduled expiration on March 10, 2026.
In a letter, DCUC Chief Advocacy Officer Jason Stverak said that maintaining the 18% cap is critical to preserving credit union safety and soundness while ensuring continued access to affordable credit for members, especially those of modest means or limited credit histories.
“Allowing the loan interest rate ceiling to revert to the statutory 15% would significantly restrict credit availability and undermine the ability of credit unions to serve higher-risk and underserved borrowers,” wrote Stverak. “The NCUA Board’s long-standing use of its statutory authority to maintain the 18% cap has proven both prudent and necessary, especially under current economic conditions.”
In Place Since 1987
As the CU Daily has reported and as DCUC noted, the 18% interest rate ceiling has been continuously in place since May 1987 and has been renewed 23 times by successive NCUA Boards. Most recently, in July 2024, the Board unanimously voted to extend the cap through March 10, 2026, recognizing that prevailing interest rate and funding conditions warranted flexibility beyond the 15% statutory baseline.
“Credit unions are not using the 18% ceiling to overcharge consumers,” Stverak added in the letter. “Average loan rates remain well below that level for most borrowers. The cap simply allows credit unions to responsibly price higher-risk loans so members who need credit the most are not shut out entirely.”
Other Issues Highlighted
The Defense Council said it also highlighted the importance of preserving the effectiveness of the NCUA’s Payday Alternative Loan (PAL) program. DCUC said that because PAL pricing is directly tied to the general interest rate ceiling, allowing the cap to fall to 15% would reduce the maximum allowable PAL rate and weaken one of the most successful tools credit unions have to combat predatory payday lending.
“Lowering the cap would risk pushing vulnerable borrowers toward far more expensive and less regulated lenders,” Stverak stated. “That outcome runs counter to the credit union mission of financial inclusion and the NCUA’s own policy objectives.”
Two More CUs Join DCUC
Separately, the Defense Credit Union Council (DCUC) said it has welcomed two new members.
Founded in 1958 by 32 City of Bremerton, Wash. employees with just $160 in assets, Connection Credit Union (CCU) has grown into a trusted, truly local financial cooperative serving all of Kitsap County. Through decades of growth, including expanded membership, two name changes, and multiple locations, CCU has stayed rooted in its credit union values, maintaining a community-focused, family feel while offering modern products and services.
Today, with assets at $38 million, CCU remains committed to people helping people, providing personalized financial services and education to help our members thrive, DCUC said.
‘Natural Step’
“Becoming a member of DCUC is a natural step for Connection Credit Union as we continue to strengthen our commitment to serving our community with integrity and purpose. There is a strong military and retired military presence in our community, and we’re proud to align with an organization that so strongly advocates for the credit union difference,” said CCU CEO Scott Prior in a statement.
“We’re pleased to welcome Connection Credit Union as a new DCUC member,” says Anthony Hernandez, DCUC President/CEO. “We look forward to supporting their mission in serving members across Kitsap County with our strong advocacy, resources, and guidance.”
IBEW 26 FCU Joins DCUC
In Washington, D.C., IBEW 26 Federal Credit Union has also joined DCUC.
Founded in 1955 by a small group of electricians working in the field, IBEW 26 Federal Credit Union is a member-owned financial institution dedicated to promoting the financial well-being of its members through professional, personal, competitive, safe, and sound financial services. The credit union has been fortunate to have so many dedicated volunteers throughout the years, along with the generous support of its sponsor, IBEW Local Union 26.
From its early days operating out of a basement in Washington, D.C., to its current headquarters in Lanham, Maryland, IBEW 26 Federal Credit Union has remained deeply rooted in service, volunteerism, and member trust. Its Board and Committee members continue to volunteer their time to ensure the credit union’s long-term success and stability, as it now proudly serves six labor unions throughout the greater Washington, D.C. area, DCUC said.
Many Members ‘Proudly Served’
“While we are primarily a trades-focused credit union, many of our members proudly served our country and later entered the labor trades after their military service,” Joshua Urbick, president/CEO of IBEW 26 FCU, said in a statement. “Partnering with a trade association that understands the unique needs of military members, both active duty and retired, is important to us. DCUC also has one of the strongest and most respected voices on Capitol Hill today, advocating on behalf of credit unions of all membership types and all asset sizes. We’re proud to join an organization that delivers meaningful advocacy and strengthens collaboration across the credit union movement.”
“We’re pleased to welcome IBEW 26 Federal Credit Union as a new DCUC member,” said Anthony Hernandez, DCUC President/CEO. “They carry a long-standing commitment to member service, volunteer leadership, and community support, and we look forward to working together to advance the credit union movement and service impact.”
