What Is the National Credit Union Administration?

Rodney E. Hood, board member and former chairman of the National Credit Union Administration, speaking during a House Financial Services Committee hearing in Washington, D.C., in 2019.

If you keep your money in a bank account, there’s a good chance you’ve heard of the Federal Deposit Insurance Corporation (FDIC). However, you may not be as familiar with the National Credit Union Administration (NCUA), even though there are more than 102 million credit union account holders in the U.S. today. The NCUA provides similar protection for credit union customers as the FDIC does for bank customers, but that’s just one of its roles.

Here’s a closer look at the National Credit Union Administration, its history, what it does and how it compares to the FDIC.

What Is the National Credit Union Administration?

The National Credit Union Administration is an independent federal agency that supports and regulates federal credit unions and their customers in the United States.

Created in 1970 by Congress, the NCUA oversees all federal credit unions. The first credit union was established in 1909 in New Hampshire, along with the first legislation regarding credit unions.

In 1942, the FDIC started to regulate federal credit unions. As credit unions became a more popular banking option, however, there was a need for separate regulation and insurance. Since its inception, the NCUA has worked to support consumers with fair financial practices through federally insured credit unions.

The NCUA is overseen by a three-person board of directors, including a chairman who is appointed by the president and confirmed by the Senate. The board members serve staggered six-year terms, and no more than two board members can be from the same political party.

What Does the National Credit Union Administration Do?

For the more than 9,500 federally chartered credit unions in the U.S and their customers, the NCUA provides support in several ways:

• Insure. The NCUA insures deposits made at federal credit unions.
• Charter. The federal agency provides licenses for credit unions to operate, called charters.
• Regulate. The NCUA oversees the creation and execution of credit union regulations in the U.S.
• Monitor. As credit unions do business, the NCUA oversees all federally chartered credit union activity.

The agency operates out of its headquarters in Alexandria, Virginia, with a few regional offices located across the country.

What Does the National Credit Union Administration Cover?

When the NCUA was formed in 1970, Congress also created the National Credit Union Share Insurance Fund (NCUSIF), the fund used to insure the money you deposit into credit union accounts. The National Credit Union Share Insurance Fund is administered by the NCUA and funded by participating credit unions.

The NCUA insures individual credit union accounts up to $250,000 per depositor. Should your credit union fail or close its doors, the NCUA matches your deposits up to the allowable limit based on account type.

Not all accounts are treated the same and come with the same coverage rules. Here’s a look at coverage limits based on account type.

National Credit Union Administration Coverage Limits

ACCOUNT TYPE	COVERAGE LIMIT
Individual Accounts	Up to $250,000 total in combined accounts
Joint Accounts	Up to $250,000 per account owner
Trust Accounts	Up to $250,000 per beneficiary
Retirement Accounts	Up to $250,000 combined for traditional and Roth IRAs; Keogh accounts are insured separately

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The NCUA also offers separate coverage for trust interests of beneficiaries of irrevocable trust accounts. The NCUSIF protects members’ share accounts in all federal credit unions and the majority of state-chartered credit unions as well. There’s no cost for insurance through the NCUSIF for consumers.

You can use the NCUA’s Share Insurance Estimator to calculate your insurance coverage for personal credit union member share accounts.

What Accounts Are Not Covered by the National Credit Union Administration?

As credit unions have become a popular alternative to traditional banks, they’ve become full-service financial solutions for millions of people. Many credit unions offer competitive financing, retirement and investment products for consumers.

Not all of these types of accounts are federally insured, though. The NCUA doesn’t insure:

• Mutual funds
• Stocks
• Bonds
• Life insurance policies

What’s the Difference Between the NCUA and the FDIC?

The NCUA and FDIC have similar roles, just for different institutions and consumers. The NCUA regulates and insures all federal credit unions and most state-chartered credit unions. The FDIC regulates and insures U.S banks. They both insure select financial accounts up to $250,000 per depositor, per ownership category. Both federal agencies work to protect consumer interests.

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