Organizing An LGBTQ-FCU

The Coalition’s vision is to found the first nationwide LGBTQ Federal Credit Union (FCU) by 2023 offering fair & equal access to financial services, planning, and products specialized for the unique financial needs and concerns of LGBTQ consumers & communities.


How an LGBTQ Credit Union is better than a “traditional” bank:

Because their mission is to cultivate financial wellness for their members now and into the future, credit unions offer a wide array of benefits to the members they serve.

All the Services You Expect, Delivered Better.

Credit unions offer all the in-person and online checking features customers expect from a 21st-century depository institution. But because the credit union and its staff are dedicated to serve the needs of its member community, CUs offer more comfortable, familiar, & friendlier service, and their staff employ their community knowledge to develop and offer more targeted services which can meet the unique needs of their members, whereas traditional banks develop their products to sell to the mainstream mass-market.

Mission-Driven, Not Profit-Driven.

Because a credit union is not-for-profit, it has no shareholders or debts owed to outside investors, so it has no incentive to charge higher-rates in order to pay dividends or lavish bonuses. As a result of a focus on providing the best service to members, without any profit-mongering, credit unions can offer lower interest rates than traditional thrifts and savings & loans. Instead of offering products which drown customers in fees and interest, credit unions offer more affordable products to help members get their finances and debts under control

Transforming Savings into Investment.

Credit unions, like traditional commercial banks and thrifts, transform their members’ short-term deposits into longer-term loans to individual & business customers. Since lending from credit unions is a key means for businesses to start-up and to expand, credit unions are using member savings to make community investments. When that loan is paid back they use that revenue to pay back their depositors in savings and checking account interest, and to make new loans to new borrowers–which can support a virtuous cycle of savings and investment.

Truly Innovative Products & Services.

Traditional financial services firms and leaders love to promise financial “innovations,” but instead offer business-as-usual: the sub-prime products and services they offer to the poorest charge high interest and fees, actually inhibiting borrowers from creating savings or equity to achieve financial goals. Because a credit union’s focus is on high-quality (not high-interest) services for members, credit unions can offer truly innovative products and services whichuse financial instruments and planning to get customers out of financial distress, instead of creating even more obstacles to success.

Common FCU Services & Benefits:

Federal credit unions offer many of the common financial services which are expected by consumers from a 21st century financial institution, and even a few more they do not expect.

Individual Member Services
Deposits & SavingsConsumer CreditMember Services AnywhereFinancial Education & Counseling
Checking Accounts Checking Accounts
Accounts so that members can access their deposited funds anywhere using an ATM/debit card or check.
Deposit Insurance Deposit Insurance
Deposits are insured by the National Credit Union Share Insurance Fund (NCUSIF) to ensure depositors always get their money back.
Educational Savings Accounts Educational Savings Accounts
Savings accounts to help households save for family and children’s education and training, with tax benefits.
Health Savings Accounts Health Savings Accounts
Savings accounts for medical needs and emergencies, with higher yields of return and tax benefits for income saved in HSAs.
Individual Retirement Arrangements (IRAs) Individual Retirement Arrangements (IRAs)
Many credit unions offer members’ the ability to save for retirement using standard and “Roth” IRAs.
Savings Accounts & Certificates of Deposit Savings Accounts & Certificates of Deposit
Higher-interest yield accounts & deposits, to make more of savings.
Credit Cards & Credit Card Rewards Credit Cards & Credit Card Rewards
Unsecured loans to individuals and businesses to use for many kinds of purchases using a convenient card, at times with rewards points or benefits for patronizing partner businesses.
Home Equity Lines of Credit Home Equity Lines of Credit
Lower-interest lines of credit, secured by a home, often used to make home improvements or consolidate other loans at a lower rate.
Mortgages & Auto Loans Mortgages & Auto Loans
Loans for individuals purchase secured assets such as homes or cars, often at lower interest rates than at banks or thrifts.
SAFE Loans SAFE Loans
Short-term loans to help members reach their next pay-date, but without the astronomical interest of payday loans, so members’ can break cycles of high-interest and default, and get back on track.
Personal Loans Personal Loans
Unsecured loans issued to consumers by credit unions, which are made for many different kinds of uses (e.g. home or self improvement, purchasing needed goods or services).
Mobile & Online Services Mobile & Online Services
Using apps and online portals, members can manage their funds, deposit checks, open accounts, or get loans from the convenience of home or anywhere with internet.
24/7 Customer Service 24/7 Customer Service
Members receive friendly service from trained professionals whenever they call or chat with their credit union, either through an in-house specialist or hand-picked partners.
Credit Counseling Credit Counseling
Many credit unions offer access to counseling in house and/or through accredited service for clients in need of help understanding credit concepts.
Budgeting Assistance Budgeting Assistance
Assistance to help financial and credit learners create effective budgets to manage their current obligations and understand their household’s financial capacities.
Enterprise Workshops Enterprise Workshops
Members can access workshops about organizational finances, and work with in-house experts, to create plans to help their businesses or nonprofits succeed.
Enterprise Services
Business Checking ServicesBusiness LoansCredit Card Processing & Merchant AccountsInsurance
Checking and savings accounts for groups to deposit and access their organizational funds with debit cards or checks.
Loans for businesses to make profitable investments in capital expenditures, human capital, or to profitably restructure finances.
Enabling businesses to accept credit and debit cards so customers can pay using any means, and businesses can make more profit.
Access to insurance through the credit union, or referred through partners, to meet the insurance needs of their employees and organizations.

Some unique benefits an LGBTQ FCU might offer:

Adoption & Fertility Loans or Grants
Low-or-no interest loans or grants to cover family planning costs (e.g. adoption, fertility, IVF, surrogacy services) which LGBTQ people disproportionately shoulder.

Gender Affirming Loans or Grants
Low-or-no interest loans or grants for gender-affirming treatments and services (e.g. hormone therapies, transition surgeries, vocal therapy) which insurers do not cover.

Access to LGBTQ-specific Financial Planning
To help LGBTQ families of all kinds and shapes make successful plans for retirement & secure financial futures, absent estranged family & inclusive of our chosen family.

Rewards for Keeping it in the Family
Credit card points can reward members for using their credit or debit cards to patronize LGBTQ businesses–encouraging members to keep money “in the family.”

Jobs for LGBTQ-serving Professionals
An FCU can create good-paying jobs for financial and customer-service professionals with knowledge and/or experience dealing with LGBTQ finances and individuals.

Increased Access for Sex & Gender Services
Traditional lenders frequently balk at serving businesses which may pose “non-traditional” risk. Sex and gender affirming services can promote access for these groups and individuals who have restricted, or no, access at present.

How do we create an LGBTQ FCU?

The Coalition anticipates it will require 3-5 years to ensure we have a robust and representative engagement of the LGBTQ community, including individuals, businesses, and community groups, and sufficient time to organize a sustainable LGBTQ FCU.

Phase I: Community OrganizingPhase II: Initial ProposalPhase III: Operations & EquityPhase IV: Approval & Launch
  • Engaging individuals, businesses, and nonprofits in the process of creating an LGBTQ FCU to ensure organizing is informed fully by community needs and driven forward with community leaders.
  • Building ~$750K-1M in financial capacity to support its organizing for 3-5 years.
  • Engaging the range of Coalition partner(s) interested in offering financial services to their members, to be included in the initial NCUA proposal as the FCU’s field-of-membership.
  • Developing robust data-analysis methods to produce research about LGBTQ financial gaps, education about LGBTQ financial issues, and field-test the systems prior to Phase II market survey.
  • Identification and subsequent NCUA approval of seven founding members (“subscribers”).
  • Production of an online and paper survey to deliver proposed membership to assess their current financial profiles and needs.
  • The production of a final business proposal based on the findings of the membership survey and outcomes of donor support engagement, including:
    1. Financial projections for operations & equity for the PFCU
    2. The FCU’s Marketing plan,
    3. FCU Bylaws
    4. requisite compliance policies.
  • The identification of an independent Board of Directors for the credit union’s operations, satisfactory to the subscribers and to the NCUA.

Based on the final charter proposal, the NCUA:

  • Issues a charter approval – or –
  • Provides comments which may require additional response on the part of Coalition organizers and PFCU subscribers prior to approval.

Subsequent to charter approval, the LGBTQ FCU may commence operations and begin offering its services to the community.

Frequently Asked Questions

What is the National Credit Union Administration?
The National Credit Union Association (NCUA) is the federal entity with oversight over credit unions, and is responsible for the approval of credit union charters.
How long does it usually take to organize a credit union?
Prospective federal credit unions (PFCUs), upon submission of their initial proposal, recieve support through the application process from the NCUA, including mentorship connections and direct support throughout the process. The NCUA advises organizers & subscribers to anticipate one to three years to complete the charter approval process after submitting their initial proposal (i.e. “Phase II” of our plan)
What are 'subscribers?'
The “subscribers” are seven individuals that are part of the proposed field of membership who wish to form the credit union, and who volunteer their time and expertise in engaging with the organizer to prepare the final charter proposal.
What qualifies a 'subscriber' to organize an FCU?
The NCUA approves proposed as qualified to organize an FCU. The subscribers must be identified to the NCUA in writing, and submit to a relevant financial backgound check (e.g. credit reporting, bankruptcy records, etc.). Based upon the findings of the background check, the NCUA offers or withholds its approval for the particular subsciber. Because they must submit to a financial background check, it is important for subscribers to be able to demonstrate financial stability, including currentness in financial obligations and a lack of–or explanation for–prior instances of financial distress (i.e. delinquency, debt collection, bankruptcy).
Why do the organizers have to conduct a survey?
A membership survey is a pre-requisite for preparing a market analysis for the credit union. This market analysis ensures that the PFCU has been sufficiently researched and planned so that it is a sustainable financial institution, and offers services and products which actually meet its members’ needs (and not merely what the organizers think those needs are). The survey must be distributed using means reasonably certain to reach the potential members and adequately survey the local market.

How Much Will an LGBTQ FCU Cost?

Organizing an LGBTQ FCU will have two primary costs:

Community Organizing & Education:

Prior to launching the FCU, there are costs to our Coalition’s costs for the initial community engagement, the production of data and analysis to support the FCU’s business plan, and the planning and production of the FCU’s business plan. Coalition organizers anticipate these costs will be in the order of $750K-1M for the 3-5 years it will require to launch an LGBTQ FCU by 2023.
The Coalition’s pre-proposal costs include the systems for managing a nationwide campaign and producing educational opportunities and events which can support and lead to the creation of an LGBTQ FCU, such as:
  • Websites and advertisements to spread the word about the need for an LGBTQ FCU
  • Organizing platforms to connect our volunteers and organizers.
  • Survey tools and analysis software to produce top-tier reporting & analysis.
  • The time for organizers and experts to produce surveys research, reporting, & education which can make the case for an LGBTQ FCU to decision-makers and regulators.
  • Hosting events to educate the public and our community about LGBTQ financial issues and solutions
  • Hosting or attending events with LGBTQ and financial community leaders.

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Operations & Equity:

Opening a credit union requires up-front capital investment in the equipment, software, and vendor relationships which are necessary to conduct the accounting, reporting, and compliance for providing financial and lending facilities.
The NCUA estimates these costs, for small start-up credit unions, to be in excess of 80,000. In addition to up-front expenses for facilities and human capital to form the FCU’s initial operations, the NCUA recommends that prospective credit unions to plan to fully cover operating expenses for at least 3 years of their operation. In addition to operating expenses, a credit union also is also required to hold aequity which it can utilize to make loans.The amount of equity needed will depend upon further financial analyses based on market and membership research and NCUA recommendations, and so cannot be easily estimated at this time.
While the amount of capital or equity may be uncertain, the Coalition will likely seek to raise an amount in the order of $5-10M depending on the size of the membership of the LGBTQ FCU.
The Coalition is not seeking funding for LGBTQ FCU operations & equity at this time, but anticipates to begin doing so after its successful initial proposal of the LGBTQ FCU to the NCUA (i.e. in Phase II). Contributions to the Coalition are to be employed for community organizing and education purposes.

Want to Make the Switch to an LGBTQ FCU?

Unfortunately, there is no LGBTQ Federal Credit Union yet, and so you can’t deposit with or get a loan from the LGBTQ FCU yet–which is why the Coalition is organizing to create one.

If you like the sound of fairer financial services and want to make the switch to an FCU that can offer equal access and opportunity to LGBTQ individuals, businesses, and community groups you can join us on the road to making this dream a reality.

The most important way you can show support is by joining our Coalition by signing our open letter and petition for an LGBTQ FCU.

Join Us

After joining the Coalition you can support the creation of fair & equal financial services by helping fund our community organizing and education to create the LGBTQ FCU. Even $5-10 helps. Your contribution will be pooled with other donations from supporters around the country to make our dream of an LGBTQ credit union a reality.