Op-Ed: Credit unions are ready to cross provincial borders—why won’t we let them?

By Jeff Guthrie, President & CEO, Canadian Credit Union Association (article originally published on The Hub)

Canada’s credit unions are proudly member-owned, community-rooted institutions serving over 11 million Canadians and managing over $700 billion in assets. They provide 21 percent of all small business loans in the country and offer essential services in hundreds of communities, often as the only financial institution in town. These cooperative financial institutions are foundational to Canada’s economic and social fabric.

Yet, despite their reach and impact, most credit unions remain confined to operating within a single province. In a country that prides itself on mobility, openness, and economic integration, this artificial barrier is holding the sector—and its members—back.

This isn’t a mere administrative inconvenience. It’s a structural inefficiency—outdated, duplicative, and increasingly out of step with how Canadians live, work, and do business. It stifles innovation, limits consumer choice, and prevents credit unions from scaling to meet the needs of today’s economy.

Credit unions were created to serve those excluded by traditional financial institutions. They reinvest locally, operate on cooperative principles, and operate on a people-for-profit model. In over 350 communities (outside of Quebec), a credit union is the sole financial institution present. And in many others, they will soon be the only ones left as larger banks consolidate or withdraw from less profitable areas.

Yet the moment a member moves to a neighbouring province—perhaps for a job, education, or family—the relationship they’ve built with their credit union is interrupted. Mortgages may not be portable. Small business loans can’t cross provincial lines. Members must start over with an unfamiliar, often less personalized, institution. This is not only frustrating—it’s economically damaging. For entrepreneurs, it means losing trusted financing relationships just as they expand operations. For individuals, it means unnecessary disruption in their financial lives.

It doesn’t need to be this way.

Canada’s economic prosperity depends on the seamless movement of people, goods, and services. As the federal government works to dismantle interprovincial trade barriers—unlocking an estimated $200 billion in potential growth—credit unions want to be part of the solution.

They are ready to grow responsibly and strategically beyond their provincial borders. But they are constrained by a regulatory framework that hasn’t kept pace with member expectations, modern mobility, or competitive realities.

We don’t need a revolution. We need modernization.

First, we must remove the legal and regulatory barriers that prevent provincial credit unions from expanding into other jurisdictions. Doing so would allow these trusted institutions to follow their members, support business growth, and increase access to values-based financial services nationwide. It would also help foster a more balanced financial system where cooperative institutions serve as a stable, scalable, and community-first counterweight to the country’s largest banks.

This is not a plea for special treatment. It’s a call for pragmatic reform.

Since 2012, three credit unions have transitioned to federal oversight under the Bank Act to serve members across provinces. But that path is long and costly, often taking up to seven years. The Canadian Credit Union Association is working with the federal government and OSFI to streamline this process, making it more efficient and accessible.

At the same time, we are exploring a practical, targeted alternative: interprovincial expansion under existing provincial charters. This would allow a credit union to maintain its home jurisdiction while operating in another—say, an Alberta credit union serving members in British Columbia or a professional bond credit union operating nationally. It’s a flexible, locally responsive model that preserves provincial identity while unlocking growth and continuity for members.

We need a clear, coordinated framework that respects provincial oversight while enabling mobility across jurisdictions. A promising model is the “passport system” proposed by the C.D. Howe Institute, “Time for the Credit Union Passport System,” March 24, 2025, which is based on Canada’s approach to securities regulation. Under such a system, a provincially regulated credit union could operate in other provinces with mutual recognition and coordination between regulators. It would streamline oversight, reduce duplication, and enable credit unions to serve Canadians more consistently and effectively.

Short-term reforms can start now, such as enabling interprovincial mergers, clarifying deposit insurance obligations, and establishing cooperative oversight mechanisms. A long-term, harmonized regulatory environment and portable deposit insurance system will be key, but we don’t need to wait for perfect alignment to take meaningful steps forward.

And we must. The challenges facing Canadians—rising costs, housing insecurity, pressure on small businesses—demand a more inclusive, resilient financial system. As international volatility grows, building domestic strength becomes more urgent. Credit unions are already stepping up. They supported communities through the COVID-19 crisis. They are filling service gaps left by major banks. And they are reinvesting in people, not just profits.

Credit unions are ready. Canadians are ready.

We call on the provinces to unlock the full potential of cooperative finance in Canada by eliminating outdated barriers, fostering competition, and enabling scale without sacrificing local roots.