FCU Interest Rate Cap Extended

The NCUA Board approved extending the temporary 18% cap for loans made by federal credit unions until September 10, 2027.

NOTE: The cap applies to federally chartered credit unions, not state chartered credit unions. State chartered credit unions will need to follow their own state’s requirements.

§701.21(c)(7)(i) generally limits federal credit unions to a 15% cap, unless the NCUA establishes a higher maximum rate. The NCUA reviews the 15% cap every 18 months and may set a higher cap “if it determines money market interest rates have risen over the preceding six-month period and prevailing interest rate levels threaten the safety and soundness of individual federal credit unions as evidenced by adverse trends in liquidity, capital, earnings, and growth.” (§701.21(c)(7)(ii)(A)

The NCUA provided supplemental information supporting its decision to extend the cap.

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