Pennsylvania Credit Union Association

Credit Unions Offer Consumers a “Better Choice” To Avoid Payday Lenders


HARRISBURG – The Pennsylvania Credit Union Association today proudly announced the introduction of a statewide credit union alternative to costly payday loans that often begin a downward spiral of debt for Pennsylvania consumers entitled the Credit Union Better Choice.

Every day millions of consumers pay exorbitant fees and high interest rates on payday loans. Using the Internet or a retail location, payday lenders prey on those desperate for money, ensnaring them in a perpetual debt trap. To help get consumers in Pennsylvania off the payday lending treadmill, the Pennsylvania Credit Union Association (PCUA) has partnered with the Pennsylvania Treasury Department to offer the Credit Union Better Choice program, an affordable lending product for Pennsylvanians. The program was also developed with guidance and support from the Pennsylvania Department of Banking.

Through the Credit Union Better Choice program, consumers can obtain a 90-day, $500 (or less) installment loan, at an 18 % (or less) interest rate, with an application fee of $25 dollars (or less) from a participating credit union. In addition to providing lower cost loans, the hallmark of the Credit Union Better Choice program is to promote wealth building and financial education. To support wealth building, at the loan’s disbursement, an amount equal to 10 % of the loan will be deposited into a savings account in the borrower’s name. During the loan, interest accrues on the savings account and any interest paid on the additional 10 % is rebated upon payoff. To enable the borrower to make educated financial decisions, credit unions will offer financial education/coaching in conjunction with the Credit Union Better Choice program. There is no credit check required to qualify for a Credit Union Better Choice loan.

“It’s appalling what these payday lenders are charging consumers to borrow money,” said PCUA President/CEO Jim McCormack. “Payday lenders target those most vulnerable and use astronomical fees to gouge consumers and to trap them in debt. With so many families living paycheck to paycheck, I am pleased that once again credit unions have united to support working Pennsylvanians, something we’ve consistently done in Pennsylvania since 1934,” said McCormack.

Currently, there are 129 locations from 37 credit unions throughout the Commonwealth that have pledged to offer these short-term loans. The Association will continue to solicit additional credit union participation and will provide marketing support to participating credit unions. In order to qualify for a loan under the Credit Union Better Choice program, a consumer must either be a member of the participating credit union or fall into its field of membership requirements. 

In support of the Credit Union Better Choice program, the Treasury has agreed to make a $20 million dollar deposit in an interest bearing account in the credit union system. Treasurer Bob Casey has enthusiastically supported efforts to enlist credit union participation in the Credit Union Better Choice program.

Credit unions are financial cooperatives that provide affordable financial services to help their owner/members to be better informed consumers. The Harrisburg-based Pennsylvania Credit Union Association is a trade association that provides legislative, promotional, educational and operational support for more than 500 credit unions in Pennsylvania. These credit unions have assets in excess of $23 billion and serve nearly 3.5 million members. For additional information about credit unions or to find a credit union near you, visit