Two organizations, CUNA Mutual Group and Inclusiv, have teamed up to expand the network of CDFI-certified credit unions around the country.
According to an announcement on Wednesday, both institutions launched the “Community Development Credit Union CDFI Awareness and Certification Campaign” aimed at educating credit unions not currently certified as a CDFI credit union “about the benefits of certification in serving members and local small businesses, and to create a network for existing CDFI credit unions to learn about and access additional resources.”
CUNA Mutual Group, headquartered in Madison, Wis., and Inclusiv, a certified CDFI intermediary headquartered in New York City, said they believe there will be strength in numbers by increasing the number of CDFI-certified credit unions who are considered the “financial first responders,” especially during this pandemic.
According to the announcement, “Amid the economic downturn in the wake of the current COVID-19 pandemic, CDFIs have acted as lifelines and provided much needed relief to communities hardest hit by this crisis, providing payment relief, Paycheck Protection Program loans and emergency small dollar loans, among other measures.”
“We strongly support the expansion of CDFI-certified credit unions to help provide financial literacy and products to communities that are unserved, or underserved by traditional financial institutions,” Larry Blanchard, CUNA Mutual Group corporate and legislative affairs consultant, said. “CDFI credit unions advance CUNA Mutual Group’s and credit unions’ commitment to inclusivity in serving people of modest means, whether in urban or rural communities,” he said.
CUNA Mutual Group and Inclusiv said they will facilitate credit unions’ access to the possible $12 billion for CDFIs and Minority Depository Institutions (MDI) contained in the COVID-19 stimulus package currently in Congress. To this end, Inclusiv will provide expertise, technical assistance, advocacy and resources to CDFI-certified, CDFI-eligible and MDI-designated credit unions seeking to participate in these programs.
“We believe more than 700 credit unions would be able to access and apply for such funds,” Blanchard said. “With the credit union system, Inclusiv and CUNA Mutual Group have aggressively lobbied for such legislation since the pandemic, and we urge Congress to pass the stimulus package.”
“While our families and communities have experienced ongoing challenges this year, CDFIs continue to prove how vital they are to the health of underbanked communities and communities of color, acting as financial first responders in times of crisis,” Inclusiv CEO Cathie Mahon said. “The CDFI Fund is the federal program best positioned to address the racial wealth divide and the current economic crisis facing our nation. This campaign will create a space for sharing knowledge and tools aimed at expanding certification among eligible credit unions and deepening engagement with CDFI target markets.”
CDFIs have been the focus of the American Bankers Association this fall. Just last month, Joseph Pigg, ABA’s SVP for fair and responsible lending, said, in a letter to Treasury Department officials, “With nearly half of all credit unions now classified as ‘low-income,’ we question whether the NCUA’s ‘low-income’ designation accurately identifies credit unions that are committed to the development of low income and under-served communities.”
The Treasury Department has been soliciting comments on proposed changes to the CDFI application process.
According to Wednesday’s announcement, as part of the joint campaign, Inclusiv “will conduct an analysis of credit unions in target areas and provide technical assistance to credit unions interested in pursuing CDFI certification as well as to previously CDFI-certified credit unions whose certifications have lapsed.”
Credit unions interested in the CDFI certification process can find out more information here.