How to Charter a Credit Union

Credit unions are nonprofit banking institutions that serve specific communities only. They often require fewer fees than banks, but offer almost as many services. These establishment have no shareholders and are strictly nonprofit. You must charter a credit union in the counties it will serve, so if you want to start a large credit union, you'll probably need to charter it in multiple counties.

Instructions

1. Determine where you want to start the credit union. The National Credit Union Administration (NCUA) requires that there must be 500 or more potential members in the area to issue a federal charter.

2. Draw up a proposal stating your intent. It should include any demographic factors, a list of your initial board members and if you are providing a credit union for an underserved area. The most important factor to include is the economic feasibility of starting a credit union in your area.

3. Locate your regional NCUA office. There are six across the United States.

4. Make a formal request for a charter and include your proposal with your request. You'll need to call your regional office to find out how.

5. Have the staff explain the specific chartering requirements and they will assist you in making your application. Comply with any investigations the NCUA must perform to determine whether to issue your charter.

6. Wait for your organization certificate to arrive by mail. This is your official permission to start your credit union. It usually takes two weeks after the investigations have been completed to receive notification.

7. Contact your regional office for help getting started. They will assist you in setting up depositor insurance.

Resources

• Locate your regional NCUA office.