A Growing Movement: Credit Union Growth Trends Over the Past Decade

August 14, 2024 | ModernFi Insights

Last week, we announced the formation and funding of ModernFi CUSO, a credit union service organization focused on supporting and scaling the first deposit network for credit unions. Through ModernFi CUSO, credit unions of all sizes and designations can grow deposits and member relationships by providing accounts with extended NCUA insurance*. These accounts help institutions attract and retain large-value members across businesses, public funds, municipalities, and higher-net-worth members. The credit union ecosystem, driven by a shared mission to further the financial health of its members, has expanded rapidly over the past decade, and we look forward to watching and contributing to its future growth.

Over the past 10 years, the credit union ecosystem has grown with incredible speed. Credit unions now serve over 140 million members, up from 98 million in 2014. Over the same period, total assets have more than doubled, from $1.1 trillion to $2.3 trillion, representing strong expansion across both lending and funding.

One of the most exciting trends is the increased focus on non-retail business lines as credit union teams look to launch and scale business banking, public funds services, and wealth management arms, amongst others. Motivated by the desire to serve their communities holistically, including their local businesses and municipalities in addition to their local individuals, leadership teams are investing in the talent and technology necessary to support these new member segments. Commercial deposits and public funds at credit unions have each grown by 5 times over the past decade.

In some specific but important cases, thoughtful regulation has helped accelerate growth. In 2019, the NCUA increased the amount of nonmember deposits that a credit union can accept, a reflection of the importance of diversified and alternative funding sources for institutional growth. We are also seeing continued momentum in the state-by-state regulations around credit unions accepting public funds. Just this July, Florida passed House Bill 989 that allows Florida credit unions to accept public funds for the first time.

The growth and success of the ecosystem is no coincidence; it is a reflection and a result of the deep care that each credit union has for its field of membership — for the folks that live, work, or worship in their communities. Credit unions’ unique member-owner structure and true member alignment, combined now with a passion for innovation and expanded services, means that the future is bright for the ecosystem. It is an exciting time for the sector, and we at ModernFi CUSO are grateful to support and play a small role in every institution’s growth.

Best,

The ModernFi CUSO Team

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* NCUA insurance provided by program credit unions (subject to meeting certain conditions)

Sources: Credit union data provided by NCUA Call Reports

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