Adding Select Employee Groups (SEGs)

Select Employee Groups Defined

Though commonly referred to as Select Employee Groups or SEGs, these groups can share any common bond of association or occupation, not just a single employer. Common types of SEGs include:

• Employees of a company
• Employees of a government agency
• Contractors who commonly work for the same company
• Members of a church
• Members of a fraternal association

Federal multiple common bond credit unions grow primarily through adding SEGs, though they can also expand using underserved areas. Most state chartered credit unions also operate by adding SEGs; depending on their specific state regulations they may even be allowed to have SEGs as well as a geographic area within their field of membership. Federal single common bond credit unions can add SEGs too, and in doing so, they may become multiple common bond.

The Adding Process

For certain cases, such as adding contractors who work for an employer already in a credit union's field of membership, a simple housekeeping amendment to the credit union's charter is enough. In most cases, however, the credit union must receive a letter requesting credit union service, and attach it to the appropriate form below to submit to NCUA.

• For SEGs < 3,000 members: NCUA Form 4015-EZ
• For SEGs 3,000 - 4,999 members: NCUA Form 4015-A
• For SEGs > 5,000 members: NCUA Form 4015

The NCUA prefers submitting documents for SEGs <3,000 through their Field of Membership Online Application. Larger applications can be emailed to DCAMail@ncua.gov. 

NCUA Rules and Restrictions

Because the statutory purpose of Select Employee Groups is providing access to credit union services for groups that don't have access otherwise, the NCUA imposes several restrictions on federal credit unions adding SEGs.

• The SEG must be located within a reasonable distance of one of the credit union's service facilities. A reasonable distance is generally considered about 25 miles or less. Service facilities can include branches, shared branching networks, and some video-teller machines.
• If it has more than 3,000 members, the SEG must submit a statement as to why it is unable to form a credit union itself
• If the SEG has 5,000 or more members and is already within the field of membership of another (non community chartered) credit union, the credit union must submit a letter from the overlapped credit union and a statement explaining why the benefit of adding the SEG outweighs the harm to the overlapped credit union.
• Unless it has a low-income designation, a federal credit union cannot add an associational group formed primarily for the purpose of making people eligible for the credit union.
• Unless an association is one of NCUA's 9 pre-approved types, it will have to submit a copy of its charter or bylaws for NCUA approval.