ALEXANDRIA, Va. – NCUA on Thursday said video teller machines qualify as legitimate service facilities that will allow credit unions to establish membership in proximity to the new machines.

In a legal opinion issued yesterday, NCUA said credit unions may use video tellers as service facilities for both select group additions and underserved areas. The distinction is important because now NCUA can use video tellers, instead of an actual branch, to establish a neighborhood presence in order to serve a community.

“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,” said Carrie Hunt, general counsel for NAFCU, which requested the legal opinion from NCUA.

Hunt 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.

According to the legal opinion, a virtual teller machine is a qualified service facility if the following conditions are met:

• Provides real-time, face-to-face video access to live tellers at regularly scheduled weekly hours;
• Uses credit union employees or local shared branch employees as the tellers appearing on the screen;
• Allows a member to conduct all the transactions he/she could if visiting a service facility of another sort permitted by the FCU Act and Chartering Manual; and,
• Is in a physical location within an underserved area or a physical location in reasonable proximity to the group being served for group additions

“Credit unions need to embrace new technologies that allow them to improve and expand service,” said NCUA Chairman Debbie Matz. “The use of video tellers as service facilities is sensible for both credit unions and consumers.”


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