Support for NCUA authority to maintain the 18% interest rate ceiling

The interest rate ceiling is scheduled to drop in March from its current 18% to the statutory level of 15% unless the NCUA Board takes action. Knowing the significant impact this would have on credit unions and the members they serve, America’s Credit Unions is proactively encouraging the board to keep the current level in place.

“Keeping the ceiling at 18% remains essential to protect safety and soundness, by preserving needed pricing flexibility amid higher funding and credit costs, and to sustain access to credit for the very members who would be most harmed by a reversion to a 15% cap,” wrote America’s Credit Unions Head of Regulatory Affairs James Akin in a letter sent Wednesday.

Akin cautioned that credit union members turned away under a 15% cap “would likely be driven to sources of credit which are far more costly and less regulated, exactly the outcome our movement strives to prevent.” He added that competitive data shows credit unions are not using the 18% cap to overcharge consumers, but rather to price loans fairly in line with risk.

Even if the NCUA Board is not at full capacity as 2026 begins, the letter affirmed support for the NCUA’s authority to act unilaterally to preserve the 18% ceiling.

“Maintaining the loan interest ceiling is unquestionably an essential Board action for protecting the credit union system, and precedent confirms that a single Board Member can and should carry out such essential duties when the Board has vacancies,” Akin wrote.  

He reiterated how maintaining this level will provide needed stability and consistency. “Proactive action to maintain the 18% interest rate ceiling will help ensure that credit unions can continue to meet their members’ borrowing needs without disruption, while preserving the stability of the system.”

Read the full letter