After a string of policy wins, credit union advocacy can’t stop now
The coronavirus pandemic is challenging our nation in ways we never could have imagined. But when faced with great challenges, there are opportunities to rise above the fray and create meaningful change.
As the saying goes, when the going gets tough the tough get going. And that is exactly what credit unions have done; they have aided those facing financial hardships, including thousands of small businesses that were in desperate need of a financial lifeline.
When the Small Business Administration’s Payment Protection Program rollout produced delays, glitches and website crashes, credit unions hunkered down and worked tirelessly to process their members’ applications and paperwork.
By no means was this easy work. Credit unions worked around the clock to make sure their business members got the funding they needed during this crisis. Because despite initial problems with the program's rollout — and ongoing calls for more guidance and resources — this was the right decision to make.
That is the credit union way — to always put people first, well before their own profits.
NAFCU has worked to advocate on behalf of the industry on Capitol Hill. That has included securing additional PPP funding specifically for credit unions and other community lenders.
In turn, credit unions put those funds to good work. In a recent survey of NAFCU’s membership, nearly 80% of credit unions’ PPP loans went directly to our nation’s smallest of businesses — those with under 10 employees. Credit unions showed up and provided a stream of financial aid directly to our communities’ most vulnerable small businesses.
More so, the average credit union loan size was much smaller than that of the average bank. This signals that credit unions are truly getting funds into the hands of those who need assistance the most.
This is what our cooperative industry does — we deliver for our members in financial need.
Be it a natural disaster, a government shutdown or a global pandemic, credit unions have developed a strong reputation for stepping up for their members. Policymakers in Washington are listening to that message, leading to some recent victories for the industry.
After being left out of initial drafts, lobbying efforts were able to secure credit union participation in the SBA’s PPP. NAFCU also sought policy changes on loan forbearance from the Federal Housing Finance Agency and a lifting of Regulation D’s six-per-month transfer limit from the Federal Reserve, among other essential reforms.
But if there is one lesson — one major takeaway — it is that credit unions need the flexibility to serve and act quickly. In times of crisis, people look to credit unions for financial help and safety. Policymakers must not forget the consumer impact of this crisis. They must proactively legislate and amend regulations to grant credit unions greater regulatory relief to serve their members. Every. Single. Day.
We must not sit idly by and wait for another crisis to upend our economy and Americans’ livelihoods; prudent policymaking must take a forward-looking approach. Small business loans will still need to be made long after the PPP expires and well into the economic recovery. In turn, NAFCU will continue to fight to raise or eliminate the member business lending cap and extend loan maturity limits for credit unions.
Additionally, many underserved and underbanked communities will need financial services. NAFCU will push for lawmakers to allow all credit unions to add underserved and underbanked areas to their fields of membership.
The bottom line: credit unions must be equipped to act swiftly in the event of another economic emergency.
NAFCU looks forward to leading that charge on behalf of credit unions, their demonstrated record of consumer-focused behavior, and the 120 million Americans who rely on their services daily.