The regulatory environment for credit unions is entering uncharted territory. With key leadership changes, pending lawsuits, and mounting questions around agency independence, 2025 is shaping up to be a year of transformation and uncertainty. From the future of the National Credit Union Administration (NCUA) to credit union tax status and emerging technologies, today’s decisions will have lasting implications on how credit unions serve their members tomorrow.
NCUA: Unprecedented Shifts and Open Questions
The NCUA has undergone major changes in 2025. A new Chairman was appointed in January, and just a few months later, two sitting board members were terminated without cause by the current administration in a move that sparked immediate legal action.
The lawsuit, filed for wrongful termination before the board members’ terms expired, could set a critical precedent for agency governance. Meanwhile, the NCUA announced that one remaining board member could conduct all duties independently – including holding meetings, approving rules, and field of membership (FOM) decisions. This move breaks from historical precedent and raises critical questions about checks and balances in regulatory oversight.
The developments have intensified debates within the industry: Will the NCUA continue to operate as an independent agency, or is the door opening for a broader, consolidated financial regulator across all financial institutions?
Credit unions will need to keep a close eye on the lawsuit’s outcome and the administration’s next steps, as these decisions could fundamentally reshape how credit unions are regulated for years to come.
CFPB: A Shell of Its Former Self?
The Consumer Financial Protection Bureau (CFPB) has experienced a massive scaling back. With 90% of its staff terminated earlier this year they are left with just 200 employees, sparking additional lawsuits around due process and administrative overreach.
With its future hanging in the balance, the agency is backing off previous enforcement and oversight activities, particularly for fintechs, That said, the CFPB has released its 2025 supervision priorities, which include:
- Mortgage lending practices
- Fraudulent overcharges and junk fees
- Providing redress to service members, veterans, and their families
Despite its reduced capacity, these focal points signal that the CFPB still aims to exert influence, especially where consumer protection and vulnerable populations are concerned. The agency’s long-term future is in question, with increasing congressional scrutiny. Recent legislation passed has cut the operating costs of the agency by almost 50%.
For credit unions, this creates a patchwork regulatory environment. With one agency shrinking and others shifting roles, clarity is lacking, and we aren’t sure what to expect.
Tax Exemption Under Scrutiny
As recent tax legislation was finalized in Congress, credit unions advocated fiercely to preserve their not-for-profit tax exemption. While credit unions were safe this time around, the climate on Capitol Hill suggests no assumption is safe moving forward.
Credit union associations and advocacy groups are doubling down on their messaging emphasizing the industry’s community impact, reinvestment in members, and role in serving underserved populations. Still, the push for broader tax reform makes this an area where credit unions must remain vigilant.
The Impact of Emerging Technologies
Federal attention on emerging technologies has increased, but with less clarity and more contradiction. In 2025, the government announced Operation Stargate, a cross-agency initiative focused on digital assets and fraud prevention, alongside the creation of a crypto taskforce. These efforts suggest more structured oversight for crypto-related activities may be on the horizon.
At the same time, a recent executive order revoked prior federal guardrails on artificial intelligence (AI), signaling a more hands-off approach to innovation. The result? A regulatory gray area in which credit unions leveraging AI or partnering with fintechs must navigate both opportunity and risk without consistent federal guidance.
Technology strategy will need to be nimble and compliant as policy continues to evolve.
Looking Ahead: How Credit Unions Can Prepare
The 2025 regulatory environment is fluid, complex, and politically charged. But with change comes opportunity if credit unions are ready to act. Key strategies include:
- Staying engaged with advocacy: Be part of the collective voice protecting the credit union model and influencing law makers.
- Monitoring developments from NCUA and CFPB: Rapid regulatory shifts could bring surprise obligations or open new pathways.
- Auditing your compliance posture: Especially in areas flagged for scrutiny, like mortgages, fees, and member fairness.
- Evaluating your tech stack: Consider the regulatory implications of AI, crypto, and third-party integrations.
- Strengthening board and executive awareness: Now is the time for cross-functional alignment between compliance, risk, and strategic planning.
In this uncertain moment, one thing is certain: credit unions that stay informed, engaged, and adaptable will be best positioned to thrive—no matter how the rules change.