Aug. 10, 2012 – As advocated by NAFCU, NCUA has determined that a video teller machine, or virtual teller, qualifies as a service facility for purposes of satisfying NCUA chartering rules regarding select-group additions and underserved areas, as detailed in a legal opinion letter to the association released Thursday.
NCUA Chairman Debbie Matz announced the agency would soon approve such a policy during her speech before NAFCU’s Annual Conference in Nashville, Tenn. In its just-released legal opinion letter, the agency says the VTM is a valid service facility if members can interact with a credit union representative and can conduct the same types of transactions that can be handled at a branch facility.
In a June letter to Matz, NAFCU President and CEO Fred Becker urged that the agency accept video teller machines as service facilities. Becker, who also discussed the idea during the 2011 Annual Conference, said this change would allow credit unions to use technology to better serve members and help reduce regulatory burden.
Carrie Hunt, NAFCU’s general counsel and vice president of regulatory affairs, said NCUA’s finding offers credit unions an efficient way to expand services to members and people who lack access to traditional financial institution services.
“We are delighted that NCUA heeded NAFCU’s recommendations regarding virtual tellers as qualified service facilities,” said Hunt. “We hope this is a signal that credit unions can continue to innovate and promote new technologies that expand their cost-effective services to members with the knowledge that NCUA supports their efforts.”
According to the legal opinion, addressed to Becker, a virtual teller machine is a qualified service facility if the following conditions are met:
- it provides real-time, face-to-face video access to live tellers at regularly scheduled weekly hours;
- it uses credit union employees or local shared branch employees as the tellers appearing on the screen;
- it allows a member to conduct all the transactions he/she could if visiting a service facility of another sort permitted by the Federal Credit Union Act and chartering manual; and
- it is in a physical location within an underserved area or, for group additions, in a physical location in reasonable proximity to the group being served.
Hunt said NAFCU will continue to press NCUA to make use of technology a standard consideration in its rules affecting the way credit unions serve their members.