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Serving Members Around the Globe: United Nations Federal Credit Union Expands Operations to Foreign Shores

In this paper, we explore the challenges and opportunities encountered by United Nations Federal Credit Union (UNFCU), a leader in exploring the potential of expanding its operations into international areas.

Executive Summary

A credit union working to meet the needs of members and sponsors in international areas can pursue several options. The first option is a full service operation that meets member needs in both dollars and local currency. Local transaction accounts are critical if the credit union wants to be a member’s primary financial institution. Current NCUA regulations prohibit such an operation in the form of a branch office. To overcome this hurdle, at least one credit union is pursuing the creation of a state chartered affiliate to serve a foreign location.

What is the research about?

In this paper, we explore the challenges and opportunities encountered by UNFCU in detail. The RLO approach may have potential for many U.S. based credit unions with significant member bases in international areas, and is also feasible from a regulatory point of view. For credit unions with more limited resources, a partnership with other organizations may be more appropriate, as summarized in part I of the paper. Defense credit unions have unique opportunities to serve American citizens overseas as well, as we point out in part III. Part IV of the paper summarizes the regulatory and legal issues involved in expansion into international areas. The final part of the paper takes a close-up look at the Vienna, Austria, and Geneva, Switzerland operations of UNFCU.

What are the credit union implications?

As credit union sponsoring organizations expand their operations to the far-flung corners of the globe, they seek partners willing to make the journey with them, and provide services to both the organization and its people. For their part, credit unions need to seek new markets for their products and services, and to serve members who are increasingly mobile in a global economy.

This report is sponsored by U.S. Central Credit Union.

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