Each federal credit union's board of directors, elected by the members, has the authority to set loan amounts or loan ceilings as the credit union grows. The interest rate charged on loans is also established by the credit union's board of directors. The interest and other finance charges are disclosed in total and as an annual percentage rate in compliance with the Truth in Lending Act. Federal credit unions operate in compliance with this and all other federal consumer protection laws, including the Equal Credit Opportunity Act. The law requires that credit be made available to all members without regard to sex, marital status, race, age or other prohibited bases.
Members elect a volunteer board of directors at the annual meeting.
Each member has one vote regardless of the number of shares owned. The board elects officers from its own membership and appoints a supervisory committee. The credit union's net earnings from loan operations or other sources, except that portion of gross income set aside in a reserve account for loan losses, may be distributed to the members in the form of dividends. The board of directors of each federal credit union has wide latitude in determining the credit union's dividend rate and terms. Credit unions do not require outside financial support so there is no direct cost to a sponsor, including any employer whose employees organize a credit union.