The Tumble Dryer Moment: Why Credit Unions Must Plan Now for What’s Next
I feel like I’m in a dryer—just tumbling around.
That simple comment, overheard at a recent UNDERGROUND Collision, perfectly captures the mood among many credit union leaders today. We’re facing a cascade of challenges, one after another, with little time to catch our breath. But this moment isn’t just uncomfortable—it’s a signal that real threats are closer than we think, and waiting is no longer an option.
Taxation: A Threat to the Movement, Maybe Not Today But Tumble Again And…
Let’s be clear: the taxation conversation isn’t over, and it must remain about fairness and survival. If credit unions are taxed the way banks are, we lose our fundamental difference—our ability to reinvest in members instead of shareholders. History proves this isn’t just speculation. In countries such as Australia and Canada, the introduction of taxation led to a dramatic decline in the credit union movement.
And it might not happen now because a grassroots effort brought voices together to be heard, but it’s not over and may happen quietly, by accident—slipped into a larger bill, passed too fast to stop. “This won’t be deliberate. It will be quick, and you could be wiped into the frenzy before you realize it,” stated Brett Martinez (President/CEO, Redwood FCU) at a recent UNDERGROUND Collision held by Mitchell, Stankovic and Associates.
If you’re not asking, “What would this mean for my credit union?” you’re already behind.
The Regulator Shift: Be Careful What You Wish For
Many in the industry have been frustrated with the NCUA—but losing it might bring even bigger problems. Transitioning to FDIC oversight could saddle credit unions with costs, expectations, and compliance rules meant for multi-billion-dollar banks. As Martinez put it: “We’re going to really complain about being treated the same as a bank.”
It’s a warning to think twice about the trade-offs, especially as the lines between credit unions and other financial institutions become increasingly blurred.
The Real-Time Payments (RTP) and Fraud: What’s That Got to Do with Regulations?
Real-time payments are often touted as the next big leap in financial innovation—and they are. But there’s another side: fraud. Countries that implemented RTP systems saw fraud losses skyrocket, especially among smaller institutions with limited resources to combat it.
In the U.S., we haven’t yet seen the full impact. But it’s coming. And when it hits, it will move fast.
The Layered Risk Environment
One of the most dangerous things about today’s environment isn’t any single issue—it’s how they stack on top of each other:
- Taxation
- Regulator shifts
- Debit and credit interchange changes
- Real-time payments
- CFPB regulations that don’t technically exist
- State-level bills targeting fees and overdrafts
None of these threats exist in a vacuum. Each new regulation or change in law creates a ripple effect that compounds existing financial pressure.
So Where’s the Opportunity?
Despite the headwinds, the conversation doesn’t have to end in doom. Let’s talk about how this can be an opportunity for credit unions. We still have something big going for us: trust, relevance, and local connection. But those advantages only work if we tell our story—and tell it well.
Ask yourself:
- What’s your credit union’s unique story?
- How are you different from banks?
- What makes you matter to your members and your community?
- Are you doing more than just opening the doors each day?
If you’re not actively answering these questions, your competitors are writing the story for you—and it won’t end in your favor.
The Bottom Line
What we’re facing is real. It’s not theoretical. And it’s not something to put off until next year’s strategic planning session. The question isn’t if things will change—it’s how fast and how prepared your credit union will be when they do.
