Editorial: Congress needs to help credit unions

Thursday, Feb. 26, 1998 | 10:47 a.m.

In a 5-4 decision, the Supreme Court discarded a 16-year-old government rule that let company credit unions accept members from other companies. The court agreed with a legal challenge brought by banks that federal law doesn't allow credit unions to expand their memberships that way. The court's ruling will prevent many Americans from joining federally chartered credit unions, and could cost credit unions millions of customers.

Despite the decision, help may be on the way for credit unions, which for many individuals are the only institutions where they can secure low-cost financing. Legislation is being offered in Congress, which has strong bipartisan support, that would reinstate credit unions' ability to sign members from other companies.

Banks aren't hurting for business, and it's estimated that only 6 percent of financial business is handled by credit unions. In light of the increasing number of bank mergers, there is definitely a need and a place for credit unions, which offer their customers an alternative to higher-cost financial services.