MADISON, Wis.—As the financial services industry crosses the midpoint of 2025, credit unions are standing at a crossroads—recovering from a turbulent first half of the year and grappling with a host of evolving federal policies, shifting consumer behaviors, and the pressure to return to historic growth benchmarks.
Tammy Schultz, executive vice president of sales and marketing at TruStage, reflected on the challenges and opportunities facing credit unions and offered pointed advice on what must be done for the rest of the year. Her message was clear: focus on member needs, prepare for economic uncertainty, and invest in innovation to rebuild the path to 7% annual loan growth.
A First Half Dominated By Advocacy—And Unity
Looking back, Schultz said the beginning of 2025 was overwhelmingly focused on protecting the industry’s tax-exempt status.
“It felt like nothing else mattered,” she said. “Because if we didn’t win there, we weren’t going to win anywhere else.”
She noted how credit unions and their partners came together to speak with one voice in Washington, and how TruStage made advocacy a priority. Schultz shared that TruStage invested close to $160 million over five years in support of system-wide advocacy—a commitment validated by internal analysis estimating the proposed taxation would have cost the industry $3.5 billion annually.
“For a $3-billion asset credit union, that’s a $6-million hit. That’s money that would’ve otherwise gone toward lower loan rates, community development, and serving the underserved,” she emphasized.
Consumers Under Strain: Lending Slows Amid New Financial Pressures
With that policy battle behind them, credit unions now face a consumer landscape marked by inflation, high interest rates, and growing anxiety. Schultz shared findings from TruStage’s internal research that show Americans are increasingly forced to make tough financial choices.
“The average cost of a car is up to $49,000,” Schultz said. “That’s a 4% increase since 2023. But pair that with elevated rates, and suddenly people are stretching their budgets just to stay afloat.”
Anecdotal data, Schultz added, suggests many consumers are even delaying basic car maintenance like oil changes, leading to unexpected breakdowns—and unexpected expenses.
“These are the moments when members start missing loan payments, and credit unions need to be prepared,” she said.
In fact, Schultz cited TruStage’s consumer research showing that 91% of people are concerned that a life event—job loss, illness, or car trouble—could impact their ability to make loan payments. That has contributed to a marked slowdown in lending.
Credit unions are now seeing just over 4% loan growth—well below the historical average of 7%, and far from the nearly 19% spike seen during the pandemic in 2020.
“Even banks are growing slower than that,” Schultz added. “It’s not just us. But we need to figure out how to move the needle again.”
What Credit Unions Must Do Now: Second-Half Imperatives
Looking to the remainder of 2025, Schultz said credit unions must focus their attention on three critical fronts:
1. Understand The Member's Struggles
“Credit unions need to zero in on what members are actually concerned about,” she said. “Job loss, surprise medical bills, vehicle repairs—these are the stress points, and credit unions can help with products like debt protection, mechanical repair coverage, and disability protection.”
These products, Schultz noted, also offer opportunities to bolster non-interest income at a time when margins remain tight.
2. Support Small Credit Unions With Scalable Solutions
Schultz raised concerns about the widening gap between large and small credit unions, especially as regulatory and technological demands increase.
“The small, thriving credit unions often don’t get a seat at the table,” she said. “We can’t just merge them away.”
TruStage has announced 300 free Thinker level subscriptions to Filene for small credit unions in 2025 to ensure they have access to tools that help them remain competitive. Schultz also highlighted emerging models like fractional support and resource-sharing as promising paths forward.
“We’ve met CEOs managing three different credit unions. We need to make it easier for them, not harder,” she said.
3. Invest In The Right Technology—Without Reinventing The Wheel
As more credit unions revisit core systems and lending platforms, Schultz urged them to consider collaboration through vetted fintech partnerships, like those in TruStage’s venture portfolio.
“We’ve vetted 20 companies in recent months and only invested in one or two,” she said. “We do the heavy lifting so credit unions can leapfrog into modern systems without having to build it themselves.”
Reclaiming 7% Loan Growth: A Long Game
Getting back to a 7% annual loan growth rate won’t be easy—and it won’t happen overnight. Schultz said economists like TruStage’s Chief Economist Steve Rick expect modest gains over the next 18 months, but a return to the historical norm will take time and strategic effort.
That means credit unions must offer more than just loans—they must offer confidence, she said.
“If members are worried about missing payments, they’ll hesitate to borrow at all,” Schultz said. “Credit unions have the tools to give them peace of mind. Now is the time to use them.”
The Bottom Line: Go Back To The Mission
If there’s one piece of advice Schultz hopes credit unions take away, it’s to focus on what has always set the industry apart.
“Credit unions exist to serve members. It’s about financial well-being, community, and trust,” she said. “With the economy uncertain and the policy environment noisy, the best thing credit unions can do is refocus on that mission—and build everything else around it.”