On July 21, President Obama signed into law the Dodd-Frank Act. The public is now aware of the harm financial service institutions can inflict on consumers, communities, and the economy at large. Your members have likely relied on public commentary — which is pro institution rather than pro consumer — to learn about financial reform. And because of the “sky is falling” rhetoric that permeates reform discussion, they are just as likely unfamiliar with how this financial legislation actually benefits them.
Financial institutions across the country are informing their customers of how reform will affect them. It is important you lead that dialogue. As part of our credit union mission, we are tasked to help members become literate consumers and make informed financial decisions. For your members to make informed decisions, you must be proactive in your disclosings. It is this transparency that allows your members to believe in and trust you.
The template below provides a framework for positioning the positive outcome of reform for the credit union model. Tell your members credit unions are designed to promote member prosperity, and as such, their relationships with their credit union will not be affected by this new regulatory environment.
Dear [Member Name],
Last week, President Obama signed into law a financial reform bill designed to promote the stability of our financial markets. As you know, the reform is in response to the significant harm some financial institutions inflicted on consumers, communities, and the economy at large. I’d like to take this opportunity to assure you this legislation won’t change the way [Credit Union Name] operates in the best interest of our members, which has always been our purpose. It will, however, highlight the value of being a part of a member-owned financial institution.
The intent of the Dodd-Frank Act is to protect consumers. Establishing a standard of enhanced transparency allows consumers to make better choices about their finances. Open disclosure will help you better understand the costs, benefits, and risks of financial products and services. Legislation such as this is a positive development that exposes abusive practices and weeds out unscrupulous players.
The consumer protections introduced by this law benefit not only the users of financial services but also the credit union movement in the following ways: it leaves the cooperative regulatory system intact and independent; it makes permanent the $250,000 insurance guarantee for individual account holders ($250,000 each for joint account holders); and it better illuminates the value credit unions routinely provide members.
On behalf of [Credit Union Name], I’d like to thank you for your continued loyalty and membership. We strive every day to provide the services and protection you have come to expect from your member-owned financial institution. Everyday our sole purpose is to provide better value and offer a safe harbor in financial services.
[Credit Union CEO Name]