Employees who lack a rainy-day fund for unexpected expenses can get a 0% “Impact Loan” at $185 million asset CHROME Federal Credit Union in Washington, Pa.
The credit union developed the loan program to “take care of the people who take care of the members,” says President/CEO Robert Flanyak.
“We know that when our employees are distracted because of life events they’re not able to bring their entire selves to work,” he says. “They’re worried about bills, how they’ll get the car fixed, or how to pay for medical care.”
Like most of CHROME Federal’s members, the credit union’s 43 employees typically lack a rainy-day savings account to cover unexpected expenses, which often forces them to borrow funds or max out credit cards, Flanyak says.
The Impact Loan allows employees to repay the balance over roughly 12 months while depositing 10% of the loan amount in the employee’s rainy-day account. The deposit is made after the employee completes budget counseling.
“If it’s a $2,000 loan and it’s paid off over a year, $200 of their total loan repayment is put into the account,” Flanyak explains.
CHROME Federal protects employees’ privacy and increases their financial literacy by:
The credit union launched the program in September 2021 with a loan fund of $25,000. As of April 30, 2022, five loans have tapped $8,800 in funding, with $3,900 repaid to date.
The loan maximum is set at $3,000 but can be waived if warranted. Employees who repay their first loan can borrow again later.
When loans are repaid, the funds remain in the program to aid future borrowers. CHROME Federal will replenish funds as needed to cover savings deposits and fees.
Flanyak says employees see Impact Loans as tangible proof that CHROME Federal “has employees’ backs.”
“In a world where we’re trying to retain our best employees, this can differentiate the credit union as a good employer that cares about employees,” he says.
CHROME Federal also nurtures its employees with coaching, development courses, and a career path. But Flanyak notes that even employees who value the credit union's culture and an umbrella of benefits that protect them on a “rainy day” can find the workplace challenging when coping with the pandemic and the unpredictability of everyday life.
“There is a dovetail in this when you talk about mental health,” Flanyak says. “We want to give employees the ability to stay focused on the job and not worry about their personal struggles, which helps keep our people engaged. We’re just trying to keep everybody moving forward.”