The Expanding Financial Access for Underserved Communities Act will enable credit unions to provide financial services to more communities, often areas banks have abandoned or shown little interest in serving, CUNA wrote to House Financial Services Committee leadership Tuesday. The committee Chairwoman Maxine Waters, D-Calif., introduced the CUNA and League-supported field of membership modernization legislation.

CUNA sent its letter in response to a March 10 letter from the American Bankers Association on the bill. CUNA’s letter notes banks closed a net of 7,812 bank branches while credit unions opened a net of 1,439 credit union branches between January 2005 and March 2021, according to its research.

“The decrease in bank branches demonstrates bankers’ profit over people approach to financial services,” the letter reads. “The increase in credit union branches demonstrates that credit unions are not only committed to providing services to communities but are also committed to being physically present in those communities as well.

“Credit unions will never apologize for our dedication and commitment to provide financial services to the most vulnerable Americans,” it adds.

Specifically, the bill would:

• Allow all federal credit unions to add underserved areas to their field of membership
• Exempt business loans made by credit unions in underserved areas from the credit union member business lending cap.
• Expand the definition of an underserved area to include any area that is more than 10 miles from the nearest branch of a financial institution.

“Any serious discussion of policy remedies to address access to financial services to underserved or unbanked persons, businesses and communities must include modernizing laws and regulations which hinder credit unions from serving those the banks have left behind,” the letter reads. “Credit unions’ field of membership restrictions, and the member business lending cap, shut out those that need access to mainstream financial services. This legislation is not a panacea to these exclusionary policies, but it does represent a solid free-market step forward toward financial inclusion and serving those who have been unable to access our nation’s financial institutions.”