It is time we flip the script on the coronavirus pandemic. For every headwind and roadblock our nation faces, there is an impressive success story of persistence, triumph and accomplishment waiting at the other side of this crisis.
With the 2020 elections in the rearview mirror, our nation must press forward, put an end to divisive partisanship and combat the coronavirus pandemic head-on. As financial hardships take hold of our communities and local economies, bipartisan reforms that empower credit unions offer a compelling way forward for our nation to emerge from the current crisis better, stronger and more united.
Today, experts are seeing some signs that Americans are unable to keep up with their bills and are burning through their savings. As member-owned cooperatives, credit unions have a unique business model that motivates them to dig deep, develop solutions and proactively offer financial support to their members. Credit unions’ members are their friends, families and neighbors, and no other industry knows the economic struggles and needs of Americans better than they do.
Since the onset of the pandemic, many credit unions have stepped up and proactively begun offering skip-a-pay options, fee waivers, low or no-interest loans, loan modifications, drive-thru services and other beneficial financial solutions to their members.
Low- and moderate-income communities are being hit the hardest by this current crisis. But credit unions are pillars in these communities, as more than 500 credit unions are designated as Minority Depository Institutions – more than three times as many as banks. Where for-profit banks look to make money, credit unions look to help people.
Credit unions historically have focused on the underserved. In addition, the majority of credit union loans to small businesses and their membership at-large are small, totaling less than $250,000 per loan.
It is moments like this that define the credit union industry as strong marketplace actors that always go to bat for their members. It is time policymakers do the same and help our communities financially recover by helping community-based lenders such as credit unions.
At NAFCU, we encourage President-elect Joe Biden to work with Congress to deliver meaningful, bipartisan reform that puts the needs of Americans ahead of partisanship. And credit unions are a key part of the solution.
A good place to start for policymakers would be to support reforms that help credit unions grow and streamline regulations to allow credit unions to put more resources toward serving their 122 million members nationwide. This includes member business lending and capital reforms, automatic forgiveness of Paycheck Protection Program loans under $150,000 and increasing funding for Community Development Financial Institutions to help low-income communities.
Our message to President-elect Biden and the 117th Congress is simple: Credit unions are here to help the American people continue to recover from the pandemic. We look forward to working with the administration and Congress to ensure credit unions remain a strong financial lifeline and community partner for the millions of Americans needing financial assistance.
Bipartisan solutions are the keys to success, and now is the time for our nation to come together and work together.
B. Dan Berger is president and CEO of the National Association of Federally-Insured Credit Unions.
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