To join a credit union, you must meet specific eligibility requirements. Under the Federal Credit Union Act of 1934, these eligibility requirements are called the Field of Membership or FOM.
FOMs are based on the credit union’s charter and can be amended over time to expand opportunities and increase membership. Like any entity, a credit union needs members to function. An FOM defines who can become a member of a credit union.
Read on to learn more about membership, types of credit union charters, and HFS FCU’s FOM.
What is Field of Membership?
A credit union’s field of membership essentially consists of the eligibility requirements that define who can join a specific credit union, as defined by the credit union’s charter.
There are typically three types of federal charters:
- Single common bond
- Multiple common bonds
- Community charter
Types of Credit Union Charters
Here’s a closer look at the three main types of credit union charters:
Single Common Bond
Single common bond (SCB) charters refer to a single group of members who share an occupation or association. An example would be establishing a credit union for teachers or members of a labor union and only offering membership to employees of a particular company.
A type of single-occupation common bond is a trade, industry, or profession (TIP) charter. True to their name, TIP charters are based on employment in a trade, industry, or specific profession.
Multiple Common Bonds
As the name implies, multiple common bonds (MCBs) intend to serve more than one group that meets one or more eligibility requirements. An example would be people who share a specific profession but work for different companies (e.g., a credit union for teachers). Or, an MCB could combine occupation and residency requirements.
MCBs can add more groups to their FOM and build membership faster than SCBs or community charters.
Community Charter
The final type of credit union charter we’ll mention here is a community charter. As the name implies, community charter eligibility requirements are community-based, often including either residency or employment requirements within a specific geographical area, such as a neighborhood, municipality, or district.
According to the National Credit Union Administration (NCUA), a community charter must define membership eligibility as a well-defined local community with clear geographic boundaries.
At HFS FCU, membership is open to all who live, work, worship, attend school, volunteer, or participate in associations headquartered on the island of Hawaii.
Restrictions and Requirements for Field of Membership
Credit unions must meet various requirements when defining their field of membership. For instance:
- Federal credit union charter regulations determine how FOMs are defined and expanded over time.
- Certain credit unions focus on a specific area and may be subject to geographic or group-related restrictions when defining their FOM.
- Credit unions must meet documentation requirements. For instance, they must include a business plan, various financial statements, and a clearly defined FOM.
Learn more about the requirements credit unions must meet from the NCUA.
Expanding the Field of Membership
Over time, a credit union may elect to expand its field of membership and open up its eligibility requirements so that more community members, like those with a preexisting close relationship with current members or people in underserved areas, can join. To do so, credit unions must first receive approval from the NCUA. Credit unions can grow from there by expanding occupational requirements or adding associated groups. Some credit unions amend their charters and FOM to add underserved areas that could particularly benefit from credit union membership, attracting potential members.
Any changes to the FOM must typically involve a request to the NCUA followed by a review of the changes and intentions.
Why Field of Membership Matters to Members
The field of membership is crucial for credit unions in defining their eligibility requirements—it’s also vital for credit union members. Specifically, the FOM allows credit unions to focus on serving a particular community or group of people, offering benefits like better interest rates, tailored financial services, and more.
For example, a credit union for teachers may sponsor an annual scholarship to a student within the community who is interested in studying to become a teacher to strengthen its ties with the community and the membership base it serves further.
HFS FCU was founded in 1937 in Hawaii. It started by serving only federal and state employees and later expanded to a community charter. HFS FCU still retains its sense of family and a deep desire to help those in the community. At HFS FCU, they believe that the credit union’s success comes from its members’ success.
How HFS FCU Defines Its Field of Membership
Members at HFS FCU is offered to those with the following common bond:
- Persons who live on the island of Hawaii
- Persons who regularly work, attend school, worship, volunteer service, or participate in associations that are headquartered on the island of Hawaii
- Persons participating in programs to alleviate poverty or distress which are located on the island of Hawaii
- Incorporated or unincorporated organizations located on the island of Hawaii or maintaining a facility on the island of Hawaii
- Spouse of persons who died within the FOM of this credit union
- Employee of HFS FCU
- Members of their immediate families or households; and organizations of such persons.
Closing the Gap: Find Your Place with HFS FCU
FOMs help define eligibility requirements and can also help signal the level of a credit union’s involvement with the community. It’s important to join a credit union that you qualify for, and that shares a sense of belonging based on its community efforts.
Become a Member of HFS FCU Today
Contact us today for more information on HFS FCU and to determine if you meet our credit union’s eligibility requirements. When you bank with HFS FCU, you can count on exceptional member service, lower loan interest rates, and a deep commitment to the community. We’re proud to serve our community with six convenient locations on the island of Hawaii.
Learn more by visiting our website or contacting us.
FAQs
What is a credit union Field of Membership?
A credit union’s field of membership (FOM) is the eligibility requirement that defines who can join a specific credit union, as defined by the credit union’s charter.
What are the types of credit union charters?
There are three main types of credit union charters: single common bonds, multiple common bonds, and community charters. Single common bond (SCB) charters refer to a single group of members who share an occupation or association, while multiple common bonds (MCBs) intend to serve multiple groups that meet one or more eligibility requirements. Community charter eligibility requirements are community-based, often including either residency or employment requirements within a certain geographic area, such as a neighborhood, municipality, or district.
Can I join a credit union if I don’t meet the FOM criteria?
Generally, you cannot join a credit union without meeting FOM criteria. However, some credit unions may allow membership to family members to join — even if they don’t meet the FOM requirements. For instance, at HFS FCU, we allow immediate family members of current members to join. Immediate family is defined as spouse, child, sibling, parent, grandparent, grandchild, stepparent, stepchild, step siblings, and adoptive relationships.
How does HFS FCU determine its field of membership?
Eligibility requirements to join HFS FCU are as follows:
- Persons who live on the island of Hawaii
- Persons who regularly work, attend school, worship, volunteer service, or participate in associations that are headquartered on the island of Hawaii
- Persons participating in programs to alleviate poverty or distress which are located on the island of Hawaii
- Incorporated or unincorporated organizations located on the island of Hawaii or maintaining a facility on the island of Hawaii
- Spouse of persons who died within the FOM of this credit union
- Employee of HFS FCU
- Members of their immediate families or households; and organizations of such persons.
