Rakuten credit union application confirmed following ICBA outreach

The National Credit Union Administration reportedly confirmed that Rakuten Inc. has applied for a federal credit union charter after ICBA asked the agency for confirmation.

Details: A report from CU Collaborate said an NCUA spokesperson confirmed that Rakuten submitted an application on May 15 after ICBA last week submitted a Freedom of Information Act request seeking information on whether the “Amazon of Japan” applied for the charter and insurance under the agency’s Share Insurance Fund.

FOIA Request: ICBA noted in its request that unlike federal banking regulators, the NCUA does not maintain public databases of organizations and entities that have applied for federal insurance or a national charter. “ICBA and the nation’s community banks urge the credit union regulator to publicly weigh in on whether Rakuten is seeking a credit union charter — information that federal banking regulators make public as a matter of course,” ICBA President and CEO Rebeca Romero Rainey said in a national news release.

Background: In its news release, ICBA said:

• It has strongly opposed Rakuten’s repeated applications for FDIC deposit insurance as an industrial loan company, which would allow it to skirt regulatory oversight and violate U.S. policy separating banking and commerce, as detailed in its comprehensive white paper.

• The NCUA has presided over a credit union industry that has strayed from its founding mission of serving people of modest means with a common bond while leveraging taxpayer-funded subsidies to acquire taxpaying community banks.

More on Credit Unions: Following a recent series of five announced credit union acquisitions of community banks, ICBA separately issued a national news release that reiterated ICBA’s calls for Congress to respond by holding hearings, requesting a Government Accountability Office study on the credit union industry, and considering an “exit fee” on these acquisitions.

Grassroots Resources: Community bankers can use ICBA’s Be Heard grassroots action center to call on their members of Congress to hold a hearing on the NCUA’s lax oversight. Additional resources—including fact sheets detailing the state-by-state impact of the credit union tax exemption, a messaging playbook and ICBA white papers, and a customizable op-ed and talking points—are available on the ICBA website.

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